What is Form W-4?

Form W-4 (Employee's Withholding Certificate) tells your employer how much federal income tax to withhold from your paycheck. The 2020+ version eliminated "allowances" and instead uses a 5-step process based on filing status, multiple jobs, dependents, and additional withholding. You can update your W-4 at any time — common reasons include marriage, having a child, buying a home, or getting a second job. If you claim exempt on your W-4, no federal tax is withheld (but you still pay FICA).