Should You Claim 0 or 1 Withholding Allowances?

On the current federal W-4, you can’t claim 0 or 1 anymore. The IRS removed withholding allowances from the form starting in 2020 and replaced them with dollar-based entries for credits, deductions, and extra withholding.¹ If your goal was the old “claim 0” result, meaning maximum withholding and a bigger refund, complete only Steps 1 and 5 and add an extra dollar amount in Step 4(c). If your goal was the old “claim 1” result, meaning slightly less withholding, just complete Steps 1 and 5 and leave the rest blank. Anything you filed before 2020 stays in effect until you submit a new form.

Why the Old Choice Went Away

Each allowance used to reduce the income your employer plugged into the withholding tables, and the value of one allowance was tied to the personal exemption. The Tax Cuts and Jobs Act set the personal exemption at $0 from 2018 through 2025, and the One, Big, Beautiful Bill Act made that permanent, so the anchor for the old allowance math no longer exists.²³ The redesigned W-4 uses direct dollar inputs instead.

What the Current W-4 Asks For

The form has five steps. Only two are required for most people:

Step 1: name, address, Social Security number, and filing status.
Step 2: multiple jobs or a working spouse.
Step 3: expected tax credits, including the Child Tax Credit and Credit for Other Dependents.
Step 4(a), (b), and (c): non-wage income, itemized deductions above the standard deduction, and any extra flat withholding per pay period.
Step 5: signature.

If you skip Steps 2 through 4, the withholding tables use your filing status and its standard deduction to calculate the tax pulled from each paycheck.¹

Getting the “Claim 0” Result Today

The old “claim 0” was the safety-first choice: withhold the most, get a refund in April, never owe. To reproduce that on the current form, complete Steps 1 and 5, leave Steps 2 and 3 blank, and enter an extra dollar amount in Step 4(c). Even $25 or $50 per pay period adds up quickly and almost guarantees a refund.

Going further: if you never submit a W-4 at all, your employer must withhold at the single-filer rate with no credits or deduction adjustments, which is the highest default withholding the system produces.⁴ That’s the modern floor equivalent of claiming zero.

Getting the “Claim 1” Result Today

The old “claim 1” was a slight reduction from maximum withholding, appropriate when your standard deduction and filing status already lined up with the tables. On the current form, that’s what happens automatically when you complete only Steps 1 and 5 without additional entries. The default calculation already builds in the standard deduction for your filing status: $16,100 for single filers and $24,150 for heads of household in 2026.³ If your situation matches those assumptions, the default is accurate and no extra tinkering is needed.

The Lever That Matters More Than 0 or 1

Your filing status choice in Step 1 now drives the baseline withholding calculation. The three options are Single or Married filing separately, Married filing jointly, and Head of household. Each triggers different brackets and standard deductions in the withholding tables.

Head of household is easy to miss. If you’re unmarried and pay more than half the cost of keeping up a home for a qualifying dependent, that box applies the $24,150 standard deduction instead of $16,100, an $8,050 difference that meaningfully lowers your withholding.³ A single parent who qualifies but checks “Single” is over-withholding on every paycheck.

When the Default Isn’t Enough

Some situations cause the default withholding to fall short no matter how you’d have answered the old 0-or-1 question. Skipping the relevant step below is where most April surprises come from.

Two Jobs or a Working Spouse

Each employer withholds as if that paycheck is your only income. Because federal rates are progressive, two moderate paychecks taxed independently under-withhold compared to the combined income taxed as one. Check the Step 2(c) box on both W-4s (yours and your spouse’s, or both jobs if you hold two) and each employer will use higher withholding rates. The Multiple Jobs Worksheet on the form is more precise, and the IRS Tax Withholding Estimator at irs.gov/W4App is more precise still.⁵

Credits You Expect to Claim

Step 3 reduces withholding dollar-for-dollar against your expected annual tax. For 2026, the Child Tax Credit is $2,200 per qualifying child under 17 and the Credit for Other Dependents is $500.⁶ Two qualifying children means entering $4,400 in Step 3, which cuts withholding by roughly $169 per bi-weekly paycheck. Don’t overstate credits you’re not sure of; the shortfall lands on your return.

Income Without Withholding

Interest, dividends, and retirement distributions arrive without tax taken out. Enter the expected annual total in Step 4(a) and your employer pulls extra tax from your wages to cover it.¹ Self-employment income doesn’t belong here; that’s handled through quarterly estimated payments on Form 1040-ES, because withholding can’t cover the self-employment tax portion.

Itemizing Instead of the Standard Deduction

If your mortgage interest, state and local taxes, and charitable contributions will exceed the standard deduction for your filing status, use the Deductions Worksheet on the W-4 and enter the excess in Step 4(b).

What It Costs to Guess Wrong

Under-withholding means you owe when you file, and possibly an underpayment penalty. You avoid the penalty entirely if any one of these applies: you owe less than $1,000 after credits and withholding; you paid at least 90% of the current year’s total tax; or you paid at least 100% of last year’s total tax, rising to 110% if your prior-year adjusted gross income was over $150,000.⁷

Over-withholding has no legal penalty. You get the excess back as a refund. But that refund is your own money the government held interest-free for up to a year. In a savings account earning 4%, $3,000 in over-withholding costs you around $120 in lost interest. Some people prefer the forced savings; others would rather keep the cash flow. Either is fine as a deliberate choice.

Updating Your W-4

Revisit your withholding whenever your tax picture shifts. Common triggers:

Marriage or divorce. Newly married couples should submit a new W-4 within 10 days.⁸
A new child or dependent, which opens up Step 3 credits.
Buying a home, if mortgage interest pushes you into itemizing.
A second job or side gig, which requires a Step 2 adjustment.
A large raise or bonus that pushes you into a higher marginal bracket.
A mid-year job change. Use the Tax Withholding Estimator with your most recent pay stub so it can account for tax already withheld by the previous employer.¹

Download the current form from irs.gov or get it from your payroll department. Many employers offer a self-service portal. Once submitted, your employer must implement the change no later than the start of the first payroll period ending on or after the 30th day from receipt.⁹ Check the next few pay stubs to confirm the change took effect.

State Withholding Uses a Different Form

The federal W-4 controls federal income tax only. Most states with an income tax use a separate withholding form, and some of those still use the older allowance-based system. Nine states have no income tax and no form to file. Ask your employer or your state’s tax agency which form applies to you.

1
Internal Revenue Service. Form W-4 (2026) Employee’s Withholding Certificate
2
Internal Revenue Service. Tax Reform Provisions that Affect Individuals
3
Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026
4
Internal Revenue Service. Topic No. 753, Form W-4, Employees Withholding Certificate
5
Internal Revenue Service. Tax Withholding Estimator
6
Internal Revenue Service. Child Tax Credit
7
Office of the Law Revision Counsel. 26 USC 6654 – Failure by Individual to Pay Estimated Income Tax
8
Internal Revenue Service. Tax To-Dos for Newlyweds to Keep in Mind
9
Internal Revenue Service. Publication 15 (2026), (Circular E), Employer’s Tax Guide