This means that if you knowingly claim allowances or an exempt status to which you are not entitled, you are subject to criminal prosecution in Federal Court. Submission of a fraudulent Form W-4 is a federal crime under Title 26, U.S. Code Section 7205, that is punishable by up to one year in prison and a fine of up to $100,000.
In addition, knowingly submitting a false Form W-4 may constitute evidence of tax evasion (or other federal crimes). Tax evasion is a federal crime under Title 26, U.S. Code Section 7201, that is punishable by up to five years in prison, a fine of up to $1 Million, costs of prosecution, and an order of restitution for any federal taxes owed.
Federal Tax Calculations
State Tax Calculations