How to Fill Out a W-4 in 2026 (Including the New Tips and Overtime Lines)
Your W-4 doesn’t change how much tax you owe. It changes how much your employer holds back from each paycheck to cover it. Get it roughly right and you’ll end the year close to even. Get it wrong and you’re either giving the government an interest-free loan or writing a check in April.
Most people fill it out once on their first day and never look at it again. That’s fine if nothing changes. But if you got married, had a kid, picked up a second job, or earn tips or overtime, it’s worth ten minutes to redo it.
Step 1: Personal information and filing status
Name, address, Social Security number, and filing status. Pick the status you’ll actually use on your tax return: single, married filing jointly, or head of household.
If you’re single with no other jobs and no kids, you can stop after Step 1 and sign at Step 5. Your withholding will be based on the standard deduction and nothing else.
Step 2: Multiple jobs or a working spouse
This is the step people skip, and it’s the most common reason for a surprise tax bill.
Each employer withholds as if their paycheck is your only income. So if you have two jobs, or you’re married and both of you work, each paycheck gets the full benefit of the standard deduction and the lower brackets. Together you end up under-withheld.
You have three options:
- Use the IRS Tax Withholding Estimator on irs.gov. It’s the most accurate.
- Use the Multiple Jobs Worksheet on page 3 of the form.
- Check the box in Step 2(c). This works well when the two jobs pay about the same. The catch is that you have to check it on the W-4 for each job, so for a married couple, both spouses check it with their own employers.
Step 3: Dependents
If your income is $200,000 or less ($400,000 or less if married filing jointly), multiply the number of children under 17 by $2,200 and other dependents by $500. Add them up and enter the total.
If you have more than one job, or you’re married and both of you work, claim the kids (and anything in Step 4) on only one W-4, usually the one for the highest-paying job. Claiming them twice means too little gets withheld.
This lowers your withholding to account for the child tax credit. A married couple earning $110,000 with two kids in Texas only owes about $4,440 in federal income tax for 2026, so without this step they’d be significantly over-withheld.
Step 4: Other adjustments
Step 4 has three parts, and all of them are optional.
4(a) Other income. Interest, dividends, or freelance income that doesn’t have tax withheld. Putting it here spreads the tax across your paychecks so you don’t owe at filing time.
4(b) Deductions. This is where the 2026 form changed the most. The Deductions Worksheet now has lines for:
- qualified tips (up to $25,000)
- qualified overtime, meaning the “half” in time-and-a-half (up to $12,500, or $25,000 married filing jointly)
- the new deductions for car loan interest and for people 65 and older
- itemized deductions above your standard deduction
Each of the new lines has an income limit on the worksheet: tips and overtime only if your total income is under $150,000 ($300,000 married filing jointly), car loan interest under $100,000 ($200,000), and the senior deduction under $75,000 ($150,000).
If you earn tips or overtime and you don’t fill this in, you’ll still get the tax break, but only as part of your refund next year. Filling it in gets you the money in each paycheck instead. Our tips and overtime calculators show roughly how much that is.
4(c) Extra withholding. A flat dollar amount taken out of every check on top of everything else. Handy if you owed last year and just want a buffer.
Step 5: Sign it
Unsigned W-4s aren’t valid, and your employer will withhold as if you’re single with no adjustments.
Should you claim exempt?
Only if you owed no federal income tax last year and expect to owe none this year. That’s usually students or very low earners. If you claim exempt and then earn enough to owe tax, you’ll owe all of it at once, possibly with a penalty. An exempt W-4 also expires, so you have to file a new one every year by mid-February (February 16, 2027 for an exemption claimed in 2026).
When to update your W-4
A good rule: any time your life changes in a way that would change your tax return. The usual triggers are:
- getting married or divorced
- having or adopting a child
- starting a second job or your spouse starting or stopping work
- a big raise or a switch between hourly and salary
- starting to earn tips or regular overtime
- owing more than a few hundred dollars, or getting a huge refund, last April
How to tell if you got it right
Look at your federal withholding on your pay stub, multiply by the number of paychecks left in the year, add what’s already been withheld (the YTD column), and compare that with your expected tax. Our paycheck calculator estimates your full-year federal tax for your salary, filing status and kids, which gives you something to compare against.
If the numbers are within a few hundred dollars, leave it alone.