Instructions

• 1). Obtain a standard W-P4 form directly from the IRS or from your life insurance company (see Resources section.)
  
  
• 2). Write the number of dependents as indicated by the instructions given on the first page of the form. If you are not claimed as someone else's dependent, write "1" on line A. If you are dependent on someone else, write "0" or leave the space blank.
  
  
• 3). Write "1" on line B if the life insurance annuity is the only money from an annuity you receive each month. Carefully read the instructions to see whether this description applies to your situation, as spousal income is also considered.
  
  
• 4). Write "1" on line C if you are married. Alternately, you can write "0" if your spouse has income that is subject to withholding, or if you have more than one income that is subject to withholding.
  
  
• 5). Write on line D the number of dependents, such as children or elderly parents, that you can claim.
  
  
• 6). Write "1" on line E if you are the primary source of income for your family and will be filing taxes as the head of household. If you are not, simply leave the line blank or enter "0."
  
  
• 7). On line F, determine the child tax credit you are entitled to receive. Follow the directions carefully to determine which tax bracket you fall into with regards to the child tax.
  
  
• 8). Calculate the sum of lines A through F and enter that number on line G.
  
  
• 9). Cut the worksheet you just filled out at the line indicated, and keep it for your records. The rest of the form is what you will file with your insurance company.
  
  
• 10
  
  Fill out the basic information where indicated on the first page: name, address and so forth.
  
  
• 11
  
  Check the box in the first step, under the heading "Complete the following applicable lines," only if you do not want your insurance company to withhold federal income taxes each month.
  
  
• 12
  
  Write the number of allowances you are choosing to withhold. For example, if you are withholding the amount for both you and your spouse, enter "2." If you are withholding only the amount required for yourself, enter "1."
  
  
• 13
  
  Write any dollar amount you wish to have withheld on top of the allowance indicated in step 13. You are not required to withhold anything extra, but you have that option.
  
  
• 14
  
  Sign and date the document where indicated.
  
  
• 15
  
  Ignore the rest of the document. These worksheets will not typically be filed and only apply to those wishing to itemize deductions or figure a withholding allowance for more than one income. For those cases it would be best to see an accountant, as numerous tax laws can come into play and they can vary from state to state.
  
  
• 16
  
  File the signed W-P4 with your life insurance company.