Exempt laws

[Riddler55]

I live in Oregon and am 18. I am going to file again on my w-2. I have been claiming 1. I am trying to save for college. the w-2 form has the exempt file choice, with a box to check If I am a full time student. I am not able to start my college yet because of my parents cant pay for it either. So my question is what might be a consequence of fileing exempt? Would I have to pay at the end of a year. I also don't owe taxes from the year before.
Thanks

 

[loku]

Exemption from withholding

If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. The exemption applies only to income tax, not to social security or Medicare tax.

You can claim exemption from withholding for 2001 only if both the following situations apply.

(1) For 2000 you had a right to a refund of all federal income tax withheld because you had no tax liability.

(2) For 2001 you expect a refund of all federal income tax withheld because you expect to have no tax liability.

If you are a student, you are not automatically exempt.

If you do have to pay tax at the end of the year, there may be a penalty for under withholding, but if you see, as the year goes on, that you will end up having to pay tax, change your withholding status and have your boss withhold.