How do you know if you are withholding too much?

  • If you are consistently getting large refunds, you are probably withholding too much.
  • If your situation has changed, like you’ve gotten a new job, you may need to adjust your withholdings.

What are the situations that require you to take a look at the withholdings and adjust them if necessary?

  • You got married
  • You got divorced
  • You got retired
  • You had a baby
  • You got a new job/Lost an old one
  • You have new non-wage income and you’d like to increase withholdings
  • You bought a new house

On the other side, some workers and retirees need to take steps to make sure enough tax is being taken out of their checks to avoid penalties they might have to pay. Certain categories should pay particular attention to their withholding, and they include:

  • Married couples with two incomes
  • Individuals with multiple jobs
  • Dependents
  • Some Social Security recipients who work
  • Workers who do not have valid Social Security numbers
  • Retirees who receive pension payments

To adjust your withholding is a pretty straightforward process. You can submit a new Form W–4 providing new amounts to be withheld or changing the number of your withholding allowances. However, if your life event results in the need to decrease your withholding allowances or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days of that life event.

If you are unsure how much to withhold, you can go to the IRS and FTB websites and have their withholding calculators figure out this information for you:


  • Form 1040-ES. If you are self-employed and expect to owe a thousand dollars or more in taxes for the year, then you normally must make estimated tax payments to pay your income tax, Social Security, and Medicare taxes. You can use the worksheet in Form 1040-ES, Estimated Tax for Individuals, to find out if you are required to pay estimated tax on a quarterly basis. Remember to make estimated payments to avoid owing taxes at tax time.

Still have questions about withholding? Help is just a phone call away.