what do the number of allowances mean
The number of allowances provides the basis to your employer's payroll department to withhold on your pay. The amount of withholding becomes an estimate of your income tax liabilities for your federal and state income taxes. The greater the number of allowances or exemptions the less tax is withheld. At year end, you will file your income tax return and either owe money to the tax authorities (the IRS in the case of your federal tax) or be receiving a refund relating to the income taxes withheld.