When Carlos began working at King Acura, he was required to complete a Form W-4 that provided his employer the information to determine how much to withhold from his paycheck for income taxes. He originally claimed four exemptions but would like to increase this number to 15 because he recently has been having some cash flow problems and the larger number of exemptions would result in fewer taxes being withheld from his paycheck. He intends to make up any withholding deficiency by the end of the year.
Would you advise Carlos to change his W-4? Would your advice change if Carlos cannot make up the deficiency by year-end? Give an example of when it would be acceptable to increase exemptions and when an individual legally cannot increase exemptions.