What do I put on my Two-Earners/Multiple Jobs Worksheet?

Question

I am just starting a new job in June 08 and I am filling out my W-4. Under the Two-Earners/Multiple Jobs worksheet, line 9 is telling me to divide line 8 by the number of pay periods left in the year and that will be the amount to be withheld from each paycheck.

I am starting in June, so there are only 13 pay periods left instead of the normal 26 I would have if I was starting in January. This makes the amount of tax withheld from my paycheck twice as much as a person starting in the beginning of the year.

Am I correct in assuming that I am being penalized because I am starting a job in the middle of the year? I have been paying taxes at my old job all year, why should I be paying more just because there are only 13 pay periods left?

Answer 1

You are not being penalized. The amount of wages you look up in Tables 1 and 2 is the actual wages paid for the year, not an annualized amount. So the amount in line 7 will be HALF the additional withholding amount it would be if you worked the full year.

You are dividing HALF the amount by HALF the pay periods, which is fair and works out just fine.