Withholding Allowance

Withholding Allowance

A declaration on a W-4 form stating that an employee should have less money withheld from his/her paycheck. That is, the more withholding allowances an individual declares, the less money is withheld because it is likely that the individual will owe less in income tax. One may declare one withholding allowance each for oneself, one's spouse, and each of one's children and other dependents.