W-4 Form 2027: How to Fill It Out Line by Line

Form W-4 tells your employer how much federal income tax to take out of each paycheck. Most people only need Step 1 and Step 5, while anyone with two jobs, children, side income or the new tips, overtime and senior deductions should complete Steps 2 through 4. This guide walks through the current W-4 form line by line, with examples, and explains what changes when a 2027 version arrives.

Whether you are an employee filling one out or a small business owner collecting them from new hires, getting the W4 form right avoids surprise tax bills in April. This is general information, not tax advice.

What the W-4 form does (and does not do)

The W-4, officially the Employee's Withholding Certificate, only controls federal income tax withholding. It does not change Social Security or Medicare tax, which are fixed percentages, and it does not determine your actual tax; your return does that. At year-end your employer reports wages and withholding on Form W-2, and the difference between withholding and your real tax becomes your refund or balance due.

The IRS publishes a new revision most years. The About Form W-4 page lists the current 2026 version; a 2027 revision typically appears in December. The structure has been stable since the 2020 redesign, so the steps below apply either way.

How to fill out a W-4 form, step by step

Step	What it covers	Who completes it
Step 1	Name, address, SSN, filing status	Everyone
Step 2	Multiple jobs or working spouse	Two or more jobs in the household
Step 3	Child and dependent credits	Income $200,000 or less ($400,000 joint) with dependents
Step 4(a)	Other income not from jobs	Interest, dividends, retirement income
Step 4(b)	Deductions beyond the standard deduction	Itemizers, tips, overtime, seniors, IRA and similar
Step 4(c)	Extra withholding per pay period	Side income, under-withholding fixes
Step 5	Signature and date	Everyone

Step 1: Personal information

Enter your name, address and Social Security number exactly as on your Social Security card. Then choose a filing status: single or married filing separately, married filing jointly, or head of household. Head of household is only for unmarried people who pay more than half the cost of a home for a qualifying person. Your choice sets the standard deduction and brackets used in the withholding calculation.

Step 2: Multiple jobs or spouse works

Complete this step if you hold more than one job at the same time, or you are married filing jointly and your spouse also works. Pick one option:

• (a) IRS Tax Withholding Estimator at irs.gov/W4App. Most accurate, and the one to use if either of you has self-employment income.
• (b) Multiple Jobs Worksheet on page 3. You look up an annual amount from the tables, divide by pay periods, and enter it in Step 4(c) for the highest-paying job.
• (c) The checkbox, only when there are exactly two jobs with similar pay. Check it on both W-4s.

Complete Steps 3 through 4(b) on only one W-4, ideally for the highest-paying job, or credits will be counted twice.

Step 3: Claim dependents and other credits

If your income will be $200,000 or less ($400,000 joint), multiply qualifying children under 17 by $2,200 and other dependents by $500 on the 2026 form. You may add other expected credits such as education credits. A parent of two children enters $4,400.

Step 4(a): Other income

Enter investment and retirement income you want withholding to cover. Do not include self-employment income here; handle that in Step 4(c).

Step 4(b): Deductions and the new worksheet

The 2026 Deductions Worksheet on page 4 added lines for deductions created by the One Big Beautiful Bill Act:

• Qualified tips: up to $25,000, if total income is under $150,000 ($300,000 joint).
• Qualified overtime: the half-time premium portion, up to $12,500 ($25,000 joint), with the same income limits. Our guide to no tax on overtime explains what qualifies.
• Passenger vehicle loan interest: up to $10,000, if income is under $100,000 ($200,000 joint).
• Seniors 65 and older: $6,000 per qualifying person, if income is under $75,000 ($150,000 joint).

It also covers student loan interest, deductible IRA contributions and itemized deductions such as state and local taxes, mortgage interest and charitable gifts. Enter the worksheet's result in Step 4(b). Leaving 4(b) blank simply means withholding assumes the standard deduction.

Step 4(c): Extra withholding

Any additional dollar amount you want withheld each pay period, including the Multiple Jobs Worksheet result. This is the simplest lever for side income.

Step 5: Sign and date

The form is not valid unless signed. Employers fill in their name, EIN and first date of employment at the bottom.

Worked example: employee with a freelance side business

Illustrative: Maya is single, earns $62,000 a year paid biweekly (26 periods), has one child under 17, and expects $15,000 of net profit from freelance design that she invoices herself.

1. Step 1: She qualifies as head of household and checks that box.
2. Step 2: Self-employment is not a job for this step, so she skips it.
3. Step 3: 1 x $2,200 = $2,200.
4. Estimate tax on side income: self-employment tax of about $2,120 ($15,000 x 92.35% x 15.3%) plus income tax at roughly 12% on the remaining taxable amount, about $1,650. Total about $3,770.
5. Step 4(c): $3,770 / 26 = $145 extra per paycheck.

Maya's paycheck shrinks by $145, but she no longer needs to make quarterly estimated tax payments, and withholding counts as paid evenly through the year. If she submits the W-4 mid-year, she should divide by the remaining pay periods instead.

Example: a two-earner couple

Illustrative: Sam earns $85,000 and Alex earns $80,000. They file jointly and have two children under 17. Because their salaries are close, the Step 2(c) checkbox is a reasonable choice.

Line	Sam's W-4	Alex's W-4
Step 1(c)	Married filing jointly	Married filing jointly
Step 2(c)	Checked	Checked
Step 3	$4,400 (2 x $2,200)	Blank
Step 4(b)	Deductions worksheet result, if any	Blank
Step 4(c)	Blank	Blank

If Alex earned $30,000 instead, the checkbox would over-withhold because it splits the brackets evenly between two very unequal jobs. The Multiple Jobs Worksheet or the IRS estimator would then give a more accurate result.

How your employer turns the W-4 into withholding

Employers use the percentage method or wage bracket tables in IRS Publication 15-T. In plain terms, payroll software annualizes your pay for the period, adds any Step 4(a) income, subtracts the standard deduction for your filing status and any Step 4(b) deductions, applies the tax brackets, subtracts your Step 3 credits, divides by the number of pay periods and then adds your Step 4(c) extra amount. That is why the same W-4 produces different withholding on a weekly paycheck than on a monthly one, and why updated tables each January change your take-home pay even when you change nothing.

Should you aim for a refund?

A big refund means you lent the government money at zero interest during the year. A balance due over $1,000 can trigger an underpayment penalty unless your withholding met a safe harbor, generally 90% of this year's tax or 100% of last year's (110% if your AGI was over $150,000). Most people are best served by a small refund or small balance due. If you consistently receive more than a few hundred dollars back, reduce withholding through Step 3 or 4(b); if you owe each year, add a Step 4(c) amount.

When to submit a new W-4

• You start a new job (submit by your first payday).
• You marry, divorce, or have a child.
• You or your spouse take a second job or start a side business; see our guide to side hustle taxes.
• You claimed exempt; for 2026 you must refile by February 16, 2027.
• You receive large bonuses or commissions; supplemental pay is often withheld at a flat 22%, explained in our guide to the bonus tax rate.
• Last year's refund or balance due was larger than you wanted.

Employer responsibilities for Form W-4

If you are hiring your first employee, collect a W-4 before the first payroll and keep it on file for at least four years. Do not send it to the IRS unless asked. If an employee does not provide one, withhold as if they were single with no adjustments. Apply a new W-4 no later than the start of the first payroll period ending 30 or more days after you receive it. Our guide on how to do payroll yourself shows where withholding fits in each pay run, and the difference between employees and contractors is covered in W-2 vs 1099. Contractors complete Form W-9, not a W-4.

Common W-4 mistakes

• Claiming credits on both spouses' forms. Steps 3 and 4(b) belong on one W-4 only.
• Checking Step 2(c) on one form but not the other. Withholding then ends up too low.
• Putting self-employment income in Step 4(a). Use 4(c) instead.
• Overestimating tips or overtime deductions in 4(b), which leaves you under-withheld.
• Never revisiting the form. Recheck each January with the estimator once the 2027 tax brackets are final.

Paid as a contractor instead?

If you are paid on invoice rather than through payroll, no W-4 applies; nobody withholds for you, so you set aside your own tax and pay quarterly. Keep every invoice and payment record for your return. You can create invoices for free with our invoice generator: no sign-up, and you can download each one as a PDF.