Form W-4 question

[MJ]

I already do quarterly tax estimates for both federal and state. My wife is an employee and I was wondering if she can submit a W4 with the "exempt" option so that I can include her salary withholding in my quarterly estimates. I do realize that the form describes specific qualifications for the exemption which I suspect is the government's attempt to discourage people from not paying their payroll taxes in a timely period. Of course, I file a joint return.

 

[cathy63]

She can only claim "exempt" if you had no tax liability last year and don't expect to have any this year. If you're paying estimates, that's not true, and she does have to sign the form under penalty of perjury.

I definitely do not think anyone is going to charge her with a crime for writing exempt on a W-4, especially if your taxes are paid timely, but it really comes down to what her comfort level is. I suppose the worst that could happen is the payroll person could refuse to accept it if it's obvious that her income is high enough to owe taxes.

FWIW, I did this on a job last year. It was a short term thing that was going to pay less than $1K in total, and I knew our quarterly payments were sufficient.

 

[SevenUp]

As an alternative, could you stop paying quarterly estimates and increase her withholding instead?