How to Adjust Withholding on New 2020 W4 Form to Get Smaller Refund

The new 2020 W4 form is definitely confusing compared to the old allowances system! To reduce your withholding and get that money in your paycheck instead of as a refund, you'll want to use line 4(c) - the "Extra withholding" line. I know it seems counterintuitive, but you would put a NEGATIVE amount on line 4(c). For example, if you want about $100 less withheld per month, you could put "-$100" on that line. This tells your employer to withhold $100 less each month than the standard calculation. The other option is to use line 4(b) for deductions other than the standard deduction. If you have any additional deductions you can claim (like HSA contributions, certain retirement contributions, etc.), listing them here would reduce your withholding. The new form takes a different approach - instead of allowances, it tries to match your actual tax situation more precisely. But it definitely takes some getting used to!

Hey! I was in exactly the same boat as you last year. I hated getting a big refund because that's just giving the government an interest-free loan. I discovered taxr.ai (https://taxr.ai) which has a really helpful withholding calculator that specifically addresses the new W4 form. What I found most useful is that it explains exactly what to put on each line of the new form to get the result you want. For me, I wanted about $50 extra in each biweekly paycheck rather than a big refund at the end. Their calculator told me to put a specific amount on line 4(b) that would reduce my withholding just enough to get close to zero at tax time. The new form is definitely more complicated but once you understand it, you actually have more control over your withholding than with the old allowances system.

I wanted to follow up about that taxr.ai site someone recommended. I was skeptical at first (as you can see from my earlier comment), but I decided to give it a shot because I was still confused about how to adjust my withholding properly. It actually worked really well! The interface was way more intuitive than the IRS calculator, and it gave me specific instructions for my situation. I put the amount it suggested on line 4(b) of my W4, and my paychecks have already increased by about $80 each - which puts me on track to get just a small refund instead of the big one I was headed for. The best part was that it explained WHY I should put that specific amount, not just what to do. That helped me understand the new W4 form much better. Definitely worth checking out if you're still confused.

Has anyone else noticed how impossible it is to get through to the IRS phone line when you have questions about forms like this? I spent THREE HOURS on hold trying to ask about the W4 and never got through. I finally used https://claimyr.com and got a callback from the IRS in about 20 minutes. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The IRS agent was actually super helpful and walked me through exactly how to fill out the new W4 to get less money withheld each paycheck. Basically, you use line 4(b) and put in an estimated deduction amount. Even though I take the standard deduction, putting an additional amount there reduces the withholding calculation. Saved me so much frustration compared to waiting on hold forever.

I need to eat my words from my earlier comment. After struggling with the new W4 form for weeks and getting nowhere with online resources, I broke down and used Claimyr to reach the IRS. Got connected to an agent in about 15 minutes (after trying on my own for literally days), and they explained exactly what I needed to do. For my situation, I needed to put $4,500 on line 4(b) to reduce my withholding enough to get about $90 more per paycheck. The agent also explained that the new form actually gives you more precise control than the old allowances system once you understand how it works. Definitely worth the call, and Claimyr made it actually possible to reach a human. Sometimes you just need to talk to an actual person to understand these things.

Another option nobody has mentioned is to just submit a new W4 midway through the year if you notice you're having too much withheld. I usually check my withholding around June, and if I'm on track for a big refund, I submit a new W4 with adjustments for the second half of the year. The IRS withholding calculator lets you input how much has already been withheld year-to-date, so it can give you more accurate recommendations for the remaining months.

Something to consider: if you're expecting a big life change soon (marriage, buying a house, having a kid), you might actually WANT a bigger refund next year. Just food for thought.

Great question! I went through the exact same confusion when the new W4 came out. Here's what worked for me: Since you want to reduce your withholding (not increase it), you'll use line 4(b) for "Deductions other than the standard deduction." Even though you take the standard deduction, you can put an additional amount here that will reduce your withholding. Here's the math: If you're projected for a $1,300 refund and want to break even, you need about $1,300 less withheld over the year. Divide that by your tax bracket - if you're in the 22% bracket, put about $5,900 on line 4(b) ($1,300 ÷ 0.22). If you're in the 12% bracket, put about $10,800. The IRS withholding calculator should actually give you the exact number to put on line 4(b) when you complete it - look for the section that says "Based on the information you previously entered" and it should show recommended amounts for each line. You can always adjust midyear if needed. The new system actually gives you more precise control once you understand it!