Claiming the Right Number of Dependents
Angel wants to know how many dependents to claim so that his taxes break even. Dave says it doesn't matter how many dependents you claim as long as your tax withholdings are correct.
QUESTION: Angel in Long Beach wants to know how many dependents to claim so that his taxes break even. Dave says it doesn’t matter how many dependents you claim as long as your tax withholdings are correct.
ANSWER: The IRS does not care as long as you are withholding the proper amount for tax regardless of how it was calculated. They don’t care how many dependents you claim. I’ll give you an example. A few years ago, one of my daughters just got her first job out of college. She was single. She was not married. She had no dependents. She claimed six dependents, and it hit her taxes perfectly because the IRS tables are screwed up. Guess what? They’re incompetent. That’s no shock to anybody.
They don’t work except in certain situations. You just can’t depend on their number of dependents equaling your actual number of dependents being the proper calculation. They don’t care, by the way. The regulations state that unless you are dramatically underpaying your taxes on purpose, then you could get penalized. But if you’re not underpaying, if you’re paying the proper amount, which you did since you hit within $20, then you’re just fine. You’ve got nothing to worry about in that situation. If you actually have two dependents and you claim six in order to get that calculation to occur, it doesn’t matter. You’re fine. They don’t mind. They are aware that their tables don’t work. They don’t have enough tables to enter into the matrix that is our life. Our life is more complicated even than their tables that they use.