[header] How to process payroll [title] Instruct all employees to complete a w-4 form so that you can properly calculate federal tax withholdings on wages. [step] This form is used to document the worker's filing status. You also use the w-4 form to calculate the number of allowances the employee wants. 
Both the filing status and the allowances impact the amount of federal tax withheld from wages. [substeps] The worker's filing status can be married, single or head of household.