Changing my federal deductions on my W-4?

Hello. I'm buying a new house. I will be paying a lot in interest. I currently claim single 1 on my federal deductions. My father calculated that I can claim 5 on my federal deductions and still received money back since I will be paying so much in interest. I understand that $3400 is the amount for each deduction. I get paid twice a month from my job. I wanted to know how much more I will be receiving in each pay check if I claim 5 deductions on my W-4? Is it as simple as multiplying the $3400 x 4 and dividing by 26?

Go to this link and do the withholding calculator:

http://www.irs.gov/individuals/article/0...

You are confusing the deductions. One is your standard deduction you get from your taxes. You can go to the IRS website and estimate what you will be getting by using the tax tables.

http://www.irs.gov/formspubs/article/0,,...

You will need to know your gross pay per pay period.

You can claim yourself and one more exemption legaly, If you received a refund greater than 500 dollars last year you can add one more......Did you know that you can be fined if you receive more than 500 dollars refund on your federal taxes, they hardly ever do it, because you are letting them keep your money for free for the year, but they can..........Nuf Said

It's 3400 times 4 divided by 24 times your marginal tax rate. 24 if you are being paid twice per month. 26 if you are paid every two weeks.

So would be around $85 extra per paycheck if you are in the 15% bracket (pay after deductions and exemptions is under 34k per year) and around $140 extra per paycheck in the 25% bracket (pay after deductions and exemptions is 34k to 77k per year) etc.

I think its more calculated then that. Figure out what your taxes will be for next year. Calculate the taxes and insurance that will be on your deduction.

Say you make 50,000 a year last year. This year you get a 20,000 deduction. Calculate your next years income at 30,000 instead of 50,000 that you paid this year. Last year you paid 10,000 with 1 deduction. Next year you pay 5,000.

See what you paid in taxes and change your deductions to make up that difference. 5 sounds good though if its just you and your wife or you alone.

You either will get back alot more at the end for your return but you can calculate it pretty close. I dont know what you make but your loan officer can get closer.

If you loan officer doesnt know how to do this, call an account they can do it in their sleep.

Then call your employer and change your deductions in your payroll company.

http://www.irs.gov/pub/irs-pdf/p15.pdf

To determine your extra take home pay, click the link above and follow the instructions given for how often that you get paid.

Basically, the formula for calculating your paycheck is like this:

Gross Wages
- pre tax deductions
= taxable wages
- federal tax based upon your W-4
- state tax based upon your W-4
- social security tax based upon gross wages
- after tax deductions
= net pay.

If you take the time, you could totally deconstruct your paycheck and if you decide to contribute to a 401(k) plan, you will know exactly how much your paycheck could be based upon your contributions.