How to fill out W4 2020 [Single Filers] - YouTube

In this video I'm gonna talk about the iris form w-4 for 2020 this is gonna be

for single no dependents the super fast way to fill this thing out I'm also

going to go through the paper version then I'm gonna go through the online

estimator and then I'm going to show you how to calculate your taxes how much tax

are you really paying now I'm going to put in the description at the bottom the

times - all three of those sections so you can just jump right to the section

that you want to watch and make it as fast as possible and if you're also

looking for a different variation of the IRS form w-4 for 2020 I'll also leave

that in the description at the bottom as I've done a ton of other videos on the

w-4 now before we start if this is your first time at our channel or you haven't

subscribed click on the subscribe button at the bottom my name is Travis Sickle

certified financial planner helping you reach your financial goals

If you need a fresh copy of the w-4 I'm also gonna put a link in the description so you can

print out one if you need it so I'm gonna pull up on the screen the IRS Form

w-4 for 2020 so this is gonna be a super fast walk through remember the online

estimator is the most accurate way to fill this thing out but I'm gonna go

through the paper version and if you want to go on to the online version the

online estimator just keep watching and we'll go right into it so starting with

the paper version this is where you want to start right at the very top go ahead

and fill out your basic information with your name last name social security a

dress city or town state and zip code I'm going to go ahead and highlight it

for you so those are the sections that you want

to complete now because this walkthrough is for singles only then I'm gonna go

ahead and check off that first box now for the middle part of this form steps

two through four only if they apply to you so we know right off the bat that

we're filing single and we only have one job and no dependents so step two we can

go ahead and skip because none of those apply to us step three is gonna be claim

dependents now in this walkthrough we're not gonna have any dependents so I'm

gonna go ahead and skip this section but if you do have dependents go ahead and

fill this out or go watch the other two IRS Form w-4 video to see exactly how

you should fill out step three and step four is also gonna be

something similar now with a b and c let's go ahead and go through them with

a if you have other income not from this job including interest dividends or

retirement income then go ahead and put it in section 4a so let's say that you

had dividends of two hundred and fifty dollars you're gonna put two hundred and

fifty dollars right there otherwise you're gonna leave it blank

and if you don't have interest dividends or retirement income then you're gonna

leave for a blank otherwise go ahead and put the amount that you have in interest

dividends or retirement income the next section is step four be for your

deductions now there's a worksheet on page three for the deductions worksheet

and this is going to include and it says it right there the deductions are going

to include qualifying home mortgage interest charitable contributions state

and local taxes and medical expenses in excess of seven point five percent of

your income so let's just go through an example let's say that we've added up

all of that information and we determine that it was five thousand dollars so

we're gonna put five thousand on line one on line to enter whatever applies to

you and that is going to be the twelve thousand four hundred dollars if you're

single or married filing separately so we're gonna put in twelve thousand four

hundred dollars then it's gonna ask if line 1 is greater than line so you

subtract line two from line one if line two is greater than the line one and

through zero so we're going to add an enter zero so basically line one has to

be more than line two in order to use these deductions

so if line one is greater then go ahead and put the math there so then we can go

jump down to number four enter an estimate of your student loan interest

deductable IRA contributions and certain other adjustments so these are the

deductions that are going to help further reduce your taxable income above

and beyond the standard deduction so let's say that

we went ahead and put six thousand into our deductable IRA also called a

traditional IRA but we're making a deductible contribution to that

traditional IRA the Roth IRA is not a deductible IRA because it's after-tax

dollars contributed into the Roth IRA if we put money into that traditional

IRA let's say $6,000 we're gonna go ahead and put that online for now line

five add lines three and four enter the results here and put that in steps for B

so we're gonna go ahead and add it well obviously 0 plus 6000 is 6000 so we're

gonna go ahead and put 6000 right on page one and it's going to go right

there on 4b so let's say we put 6000 on 4b now lines see extra withholdings

isn't going to be calculated on this worksheet but if you did the online

estimator which we're gonna do next and you need to make an adjustment to your

total withholdings because you didn't withhold enough or anything previously

then you might need to play catch-up and that's where the extra withholdings are

going to come in to it's also going to show up more on married filing jointly

or if you have other special situations where you need to withhold additional

dollars for this walkthrough we're gonna put 0 and then at the very bottom we're

just gonna go ahead and sign it date it and give it to your employer and on the

updated version you don't even need to fill up the employers only section like

you did on the previous versions that's all you need to do and go ahead and turn

it in to your employer so now let's go ahead and jump over to the online

estimator that's gonna give you the most accurate results especially if you have

any changes or change jobs or have other income sources this is gonna be the best

way to fill out the IRS Form w-4 for 20/20 so here we go I'm gonna pull it

right up on the screen so you can follow along with us and this is going to be a

super fast walk through so if you need the link to the online estimator I'm

gonna go ahead and put the link in the description at the bottom so the first

section we're filling this out as single so check off single can someone else

claiming as it's dependent on their tax return go ahead and read the description

there if you're curious whether or not you qualify so we're gonna check off no

for this walkthrough now the next section is dependents and we're not

gonna have any dependents so we don't have any children or anybody else that

we're taking care of financially so we're gonna go ahead and choose no for

that section do you have income we're gonna choose

yes choose the amount of jobs for this walkthrough we're doing one job and we

don't have any other sources of income so

we're gonna choose no on the pension and if any of these apply to you go ahead

and check them off if you want more information on this then go ahead and

leave a comment in the description at the bottom if you have a question about

any one of these areas but for this walkthrough we're gonna choose next now

for this next section for the income and withholdings we're gonna go ahead and

choose yes because we expect to hold this job the entire year

if you choose no it'll give you a calendar and you can choose the dates

that you started the job and if you expect to continue there for the course

of the year until 12 31 of 2020 then just go ahead and put 12 31 2020 right

on the end date there otherwise choose yes and we can move forward and even if

you do change jobs later on it's perfectly fine you can make the

adjustment on the next time you fill out the IRS form w-4 now let's go ahead and

put the frequency for this walkthrough I'm just going to go ahead and check off

twice a month the difference between every two weeks and twice a month is 26

pay periods for every two weeks and 24 pay periods for the year four twice a

month for this walkthrough we're gonna choose twice a month so it's more along

the lines if you get paid on the 1st and the 15th that's gonna be twice a month

and then we're gonna want to put the date of our most recent pay stub or we

can just check off on the calendar now this is pretty important I'm just gonna

choose the 15th for this walkthrough and if we earn this year and that's

important because if you didn't start on January 1st than the amount that you're

making on an annual basis might not be the same of what you're gonna put here

so for example let's say you started halfway through the year and your annual

salary just for easy math is gonna be a hundred thousand dollars but that

doesn't mean you're gonna make a hundred thousand dollars in 2020 what that means

is on a 12-month basis you're gonna make a hundred thousand dollars so you just

have to do a little bit of math if you didn't start on January 1st and you're

gonna work the whole year so let's say that we're gonna earn $50,000 for the

rest of 2020 if you have any bonuses you can put that estimate in here and if you

put it in here and you're wrong and used to make that adjustment later on you can

go ahead and refill out the IRS Form w-4 and then resubmit it to your employer to

make sure it's as carrot as possible but if you only have

one job when you're filling this out it'll make the adjustments for you so

for this walkthrough I'm gonna put zeros for the bonuses and we're gonna scroll

down now this next section is really important especially if you're filling

out the IRS Form w-4 and you've already had this job for a little while you need

to make this adjustment and go look at your last pay stub your last pay stub is

you're gonna have your year to date with holdings and that's what you want to put

right here don't grab just any pay stub it has to

be the most recent one to make sure this is as accurate as possible because if

you previously didn't withhold enough dollars this will help make that

adjustment so you're withholding the correct amount

so for this walkthrough I'm just gonna make these numbers up they could be very

different from what your pay stub says so go ahead and look at your last pay

stub so year-to-date I'm just gonna say that we've withheld

$200 and from our last paycheck we withheld $100 now that next section is

did you or will you contribute to a tax deferred retirement account such as a

401k and it's referring to the pre-tax dollars so if you have a Roth 401k and

you're contributing into the Roth 401k that is not what the section is asking

for but for this walkthrough we're just going to choose no on both of these

sections now for the HSA in the FSA again if you do have those those are

pre-tax dollars so it's reducing your total taxable income if you have more

questions on that go ahead and stay to the end of the video when I explain how

the taxes work so you can get a better understanding of how deductions work

let's go ahead and click on next these are additional adjustments I'm

gonna go ahead and click off go to next step and we're gonna skip these for the

speed of this walkthrough if you want to see more on adjustments go ahead and

leave the comment down below I'll do future videos on it or you can watch

some of the other IRS Form w-4 videos that have already done and have gone

through the various sections that might come up in your particular situation so

go ahead and click off next now the deductions we're gonna take the

standard deduction and you can see it right there of twelve thousand four

hundred and this is the same thing as the paper version if you have additional

deductions you're gonna want to go ahead and fill

out this section otherwise we're just gonna take the standard deduction and

click off next now the same thing for the credits if you do have credits that

apply to you you can go ahead and apply them here which will reduce your tax

liability and reduce your withholdings as well if you want to see the list of

them see the list right here and you can kind of scroll through them and look at

in greater detail to see if any apply to you or that you could apply for some of

these for example the retirement savers credit is one that if you have a certain

income level and you contribute to your retirement plans whether or not it's an

IRA or the ones at work then you can reduce your total taxable income even

further so it's worthwhile to take a look at the retirement savers credit and

the other credits that are available so we're just going to go ahead and check

off no and go to the next section so you can see from the information that we put

in that we expect tax withholdings to be $2,500 but our anticipated tax

obligation is more than that it's four thousand three hundred and eighteen

dollars so what it's saying is our current withholdings are not enough so

let's go ahead and see what it does for the adjustment if we scroll down it'll

tell us exactly what we need to do so it's gonna say enter three dollars in

additional withholdings now if we remember on that's on line

four say if you remember on the paper version I skipped that section because

there was no adjustments that we needed to make but you can see that if you

didn't withhold enough dollars that it can make that adjustment for you so you

don't have to owe any dollars so you don't have to owe money at the end of

the year if you make sure that your withholdings are correct the nice thing

about this estimator it's already gonna fill it out for us so if we go ahead and

click off download the prefilled w-4 we could scroll down and it's already

filled it out and I know it kind of looks blank here because all you need to

do is fill out that top section and then go ahead and check off single scroll

down it already put in the three on the 4c so it's an additional $3.00 now that

small adjustment is gonna make it so we don't owe at the end of the year

so your withholdings are gonna be right on based on the information that we

already put into that online estimator go ahead and print it out

and give it to your employer and that's it that is the online estimator now if

there are any other adjustments they'll come up right on this sheet for you so

you'll know exactly the adjustments that you need to make so you don't have to go

through the worksheets that are attached on page two three and four of the IRS

Form w-4 so you go ahead and print this out or just take that three and put it

on four C or whatever numbers come out on your online estimator and that is it

now I want to jump through on how taxes are calculated in a very simplified way

just looking at the standard deduction and the tax brackets so let's go ahead

and jump right in so you can see how taxes are calculated so I'm going to use

the same scenario and I'm gonna put me 2020 taxes in this example so 2020 taxes

and then in this example we're gonna go over a $50,000 income level which is

gonna be the same as the walkthrought so you're gonna see exactly how it matches

up so we're gonna fill it out as single with no dependents so it's gonna be a

very simplified version of filling out the IRS Form w-4 so with the $50,000

first I want to show you what the standard deduction does it reduces your

total taxable income by the amount of that standard deduction and the standard

deduction for 2020 is going to be twelve thousand four hundred dollars so let's

go ahead and subtract that from our fifty thousand so what we're left with

is our taxable income and that's going to be the 37 thousand six hundred

dollars so let's go ahead and see what that looks like

so we have our dollars from zero to fifty thousand that were earning and the

first twelve thousand four hundred dollars is going to be taxed at zero

percent because that's our standard deduction so that's twelve thousand four

hundred dollars at zero percent is going to be zero dollars in taxes and now

let's take a look at our tax brackets for somebody that is single and you

could see right here from zero to nine hundred eighty seven dollars is going to

be at ten percent so that is not the first dollars that's actually after the

standard deduction so what what that looks like is the next

nine thousand eight hundred and seventy five dollars above the twelve thousand

four hundred dollars so what that really means is it's gonna bump it all the way

up to twenty two thousand two hundred and seventy five dollars twenty two to

seven five and the difference right there is our nine thousand eight hundred

and seventy five dollars that we saw on those tax brackets and that is going to

be at our ten percent so it's going to be nine hundred and eighty seven dollars

and fifty cents then the next thing that we're gonna take a look at is the next

bracket is the nine thousand eight seventy five to forty thousand one

twenty five is going to be at twelve percent now that's going to put us over

the total income in this example so what that means is to go from twenty two

thousand to seventy-five up to the fifty thousand it's all going to be at twelve

percent because the dollar limit above that above the forty thousand 125 you

would add the standard deduction that means the remaining amount is twenty

seven thousand seven twenty five that is the difference right here so that's

twenty seven thousand seven twenty-five and that's going to be at twelve percent

and that is going to equal three thousand three hundred and twenty seven

dollars it's 3327 so now what we want to do is add those two numbers up we're

going to add this number and this number so we're going to add the three thousand

three hundred and twenty seven plus the nine hundred and eighty seven fifty

we're going to add those two up and it's going to be four thousand three hundred

and fourteen dollars and fifty cents so four three one four fifty and if we

round that out 4315 now if you looked at the online estimator the estimator told

us that our tax liability is going to be four thousand three hundred and eighteen

dollars basically a rounding error so this is exactly how your taxes are

calculated now of course if you have additional deductions it's going to

reduce this number or if you have credits it's going to reduce this

number so the deductions reduce your total taxable income and your credits

are gonna reduce your tax liability and that is how you fill out the IRS Form

w-4 and looking at your taxes if you have other questions go ahead and put in

the comments down below if you've enjoyed this video be sure to subscribe

and leave your comments down at the bottom