Question about dependents and taxes

[GreenGranolaMama]

DH and I were talking about this this morning and are confused, although I am sure the answer is simple lol

He claimed "3" (DS, himself and I) so does this mean more taxes are taken out (bigger return) or less taxes are taken out (bigger weekly pay check)?

ETA: feel like we should totally know this!

[simplehome]

Claiming more exemptions means that less is taken out of your paycheck, or more take-home pay each month.

[sunflower.mama]

We'd need to know what he claimed previously. If he used to claim 9, then he'd have had more withheld and will get more back. But if he used to claim 1 the opposite is true.

[Chloe&Coop'sMom]

You more exemptions you claim, the less is withheld. My dh claims 8 and has nothing withheld from his bi-weekly paychecks. His quarterly bonuses are still taxed/withheld at about 40%, so we still end up getting a refund. He claims 8 because we need the money more to live day-to-day than we need a huge refund.

[_ktg_]

I agree with Simplehome, the more exemptions you claim, the more takehome pay you recieve, but you may end up paying it back in taxes when you file.

For example: I claim 5 for DH, me & DSx2. I could claim 4 or I could claim up to 6 based on my income.

With 5 I get more in my paycheck, but not as much as if I claimed 6. The bonus with 5 is I don't have to worry about owing any taxes when I file our 2009 taxes.

[Drummer's Wife]

yup, what the others said. When DH got a paycut, he upped his exemptions to 10. We were totally thinking we'd either owe a bit come tax time, or break even, but b/c we are a family of 6 (and a few other variables) we are still getting a refund this year. Not as much as in previous years, but still a decent chunk to save and/or purchase bigger ticket items.

Everyone's situation is different, and I think it's best to either talk to a tax advisor/accountant the beginning of the year (since taxes change) and adjust your w-2 accordingly.

[Chicky2]

My dh and I have been trying to get our neighbor to understand this for over a year. He doesn't even get that it's HIS money!

My dh claims 13. He has a comfortable income, and we have 3 dependents. We own our home and have livestock deductions, and usually a bit more than the standard medical/dental deduction. He gets very little taken out in the way of Federal taxes, and we do not have to do state taxes here. We still got back $2400 last tax season. We don't expect to get quite as much this year, but only because we don't have as many medical deductions.

[sapphire_chan]

I believe the rule of thumb is if you have to pay money or get back a refund more than $200, you should change your exemptions. (And put the extra money into some sort of interest earning account, even if it's just savings)

[sapphire_chan]

http://www.irs.gov/individuals/artic...=96196,00.html

has a calculator for figuring out how many exemptions you should take.