Whether or not you should claim an exemption from federal tax withholding depends on your specific situation. In general, if you had no tax liability last year, meaning you didn’t owe money to the IRS, and don’t expect to owe tax this year, either, you can claim an exemption from tax withholding.

To have no tax liability means that your total tax is less than your deductions and refundable credits. In most cases, that means that your income is less than the standard deduction, which is $15,750 ($31,500 for joint filers) for 2025.

It’s important to ensure that you are eligible before claiming an exemption from tax withholding. Incorrectly claiming an exemption could lead to potential penalties. It’s also important to note that an exemption from federal tax withholding does not apply to the employment taxes for Social Security and Medicare.

Is claiming a tax withholding exemption the right option for you? Talk to your local Tax Pro to find out. Book your appointment today.

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Sharon Brucker, CPA Senior Tax Research Analyst Published on: December 17, 2025
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*This content is for general informational purposes only. It is not intended to be comprehensive and should not be construed as professional tax or financial advice for any specific individual tax situation. Taxpayers should always consult a qualified professional for individual guidance. This information constitutes a solicitation under the Treasury Department's Circular 230. Most offices are independently owned and operated.