This article is about IRS Form W-4 Employee's Withholding Allowance Certificate which is a mouthful, but basically it's the form you fill out when you first start a job, and can revise anytime. You're telling the company's payroll department how much of the salary you negotiated with your boss to withhold and send to the IRS throughout the year on your behalf. The goal is to have at least 90% of what you think you'll owe paid throughout the year. Much less and you could be subject to interest and penalties, and much more (i.e. >100%) and you're giving the government an interest free loan instead of having that money work for you.

Now the form itself is rather straight forward. It asks for your name, address, and social security number, but one of the lines that's a little trickier is line five which talks about the total number of allowances. This is what will determine how much of your pay is withheld. There are several worksheets included with the instructions. Select the appropriate worksheet and go through the questions and depending on your answers, the worksheet helps you calculate how many allowances to put on line 5 of the W-4.

If you don't itemize deductions on your tax return, you just need to use the Personal Allowances Worksheet to calculate the number of allowances you're claiming. This worksheet is part of the Instruction to the W-4.

If you do itemize, you may want to use the Deductions and Adjustment Worksheet to calculate your allowances to reduce your withholding to avoid having too much withheld during the year.

If you have more than one job, or you and your spouse both work and the combined earnings from all jobs exceed $40,000 for 2009 ($25,000 married), complete the Worksheet for Two Earners/Multiple Jobs to avoid having too little tax withheld and to make sure you have enough withheld during the year.

Times to think about revising your form is when you buy a home, get married, or have children. In other words, events that affect the amount of tax you'll owe.