So my employer didn’t withhold enough taxes even though my W-4 was filled out correctly (single, no dependents, no other income). I only have this job, got my W-2, and this keeps happening every year.
I know I’ll have to pay what’s owed, but is there any way to avoid or reduce the penalties? Also, how can I get my employer to actually fix this problem going forward?
Try emailing HR and explain that you want to resubmit your W-4. Keep a record of the emails in case you need proof later. They’re supposed to let you correct it.
Hale said:
Try emailing HR and explain that you want to resubmit your W-4. Keep a record of the emails in case you need proof later. They’re supposed to let you correct it.
The W-4 is already correct. That’s what’s making this so frustrating.
@Val
Single, no dependents, no deductions, no extra income or withholdings. Everything on the W-4 and W-2 looks right, so I think it’s a payroll issue.
Sia said: @Val
Single, no dependents, no deductions, no extra income or withholdings. Everything on the W-4 and W-2 looks right, so I think it’s a payroll issue.
You could add an extra withholding amount on your W-4. If they follow that, it might help you avoid dealing with their mistakes.
It’s annoying when your employer messes up your withholding. If you end up owing more than $1,000 in taxes, the IRS could hit you with an underpayment penalty.
To avoid or reduce penalties, pay off as much of what you owe as quickly as you can. You might be able to avoid penalties altogether if your total withholding covers at least 90% of what you owe for this year or 100% of last year’s tax bill.
You can also submit a new W-4 with extra withholding, even if your current one is technically correct. Use the IRS Withholding Estimator tool to figure out how much extra to withhold.
You might want to follow up with HR again, but if they still don’t fix it, keeping a close eye on your paycheck after submitting the updated W-4 is probably your best bet.
The W-4 form changed a few years ago, and it’s been confusing for a lot of people. Yours sounds like one of the worst cases, especially since you filled it out correctly.
The IRS recommends checking your withholding midyear using their online tool and adjusting it if needed. It’s too late to fix last year, but for 2024, make sure you’re withholding enough or pay estimated taxes if needed.
To avoid penalties this year, make sure you pay at least 100% of what you owed last year or 90% of what you owe this year.