If a member claims exempt on a W-4 form filed on February 15, when does that exemption take effect?

When a member claims exempt on a W-4 form, the exemption from withholding is effective from the beginning of the tax year, which is January 1 of that current year. This means that if the form is filed on February 15, the exemption still applies retroactively to the start of the year, allowing the member to avoid federal income tax withholding on their wages from that date onward. This approach is designed to benefit the taxpayer by ensuring that they do not have any withholding for the entire year if they qualify for the exemption and have claimed it correctly.

The other options suggest different starting points for the exemption that do not align with the IRS guidelines, which clearly state that an exemption claimed takes effect at the start of the calendar year, regardless of when the form is submitted.