W4 - Questions on Tax Withholding Estimator

The purpose of a W-4 is to let your employer know how much tax to withhold from your paycheck. What their message is telling you is that if you don't submit a W-4, your employer is going to withhold too much tax, and you'll get a refund when you file (and smaller net paychecks). Some people are OK with this, using the government as a type of "savings account". For most people, the goal should be to get as close to possible as your actual tax due at the end of the year, maybe a little more to be conservative.

Getting this right with two incomes can be tricky, since one spouse's employer does not know how much the other is getting paid to estimate your total income (and thus tax owed).

If it were me, and I was confident in the "Anticipated tax obligation" from the calculator (meaning you entered in every possible deduction or at least the largest ones), then I would submit W-4s that withheld about $1,400 per month (1,400 * 12 = 16,800) in total, split however you want. That will give you a 600-700 refund if everything is accurate, or at worst will likely prevent a large unexpected tax bill. That will give you another $250 per month in your take home pay that you can use for better purposes than loaning it to the government.