Claiming Exempt with 6 figure salary - would it raise red flags in accounting at a large company? Is it legal?

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Do not claim exempt. You do not know when something might change that would make even one dollar subject to tax. You don't have to give the IRS a great big interest-free loan; you can minimize it. I find it odd that with everything else you told us, you did NOT say how many allowances you have been taking on the W-4. And you didn't say how much was coming out of every paycheck. If the withholding isn't very large and you are already claiming the 8 you would normally be allowed, try raising it to 9 and see the result. If some is still coming out, raise it to 10. By the time this all takes effect, it may be April and you may have already paid enough in to cover any future deficit, so you can safely leave it at 10 for the rest of the year.

Keep track of your periodic withholding. If going from 8 to 9 doesn't take the tax to $0, then take that change and subtract from the withholding at 9 to see how much in the hole you are, then calculate that for the entire year based on the number of pay periods. If you would owe $1,200 or less in tax the following year and you have the money to pay it, then stay at 10 and write that check for the interest-free loan the IRS gave you.

As a matter of fact, you may see this for yourself when you file for 2018, if you haven't yet. For the first time, the unused portion of the child tax credit is refundable up to $1,400 per child. In the past, this credit could only take you to $0, and $0 is what you've been used to.

For 2018, with six qualifying kids, that's a tax credit of $12k. All of that will be applied to your payments and even if you did underpay through withholding by claiming too many allowances, the additional credit might cover that. You might even be due a refund. Depending on the size of that refund, you might be OK with claiming an additional allowance or two on the W-4....Show more

The IRS rule is you can't claim exempt unless your tax liability, aka what they KEEP, was $0.00 last year and you legitimately expect it to be $0.00 this year.
You KNOW you don't come anywhere CLOSE to exempt and your income is in the LOW 5 figures....Show more

You may not have 0 tax liability. I was in a similar situation as you in the past, 5 dependents, but now only the 2 under age 17 get you the child tax credit, the older ones get "other dependent" credit which is only $500.

Do your return first before deciding....Show more

We do have people at our company who claim exempt and the most we might do is ask if they are sure they know what they are doing if we know they do not have a lot of kids but it's not our place legally to do anything different than what they put on the W-4.
That said I would complete your 2018 taxes before you make any decisions. They have removed much of the advantages you get from deducting your kids other than 2k tax credits if they are 16 or younger....Show more

1. You can talk to HR, they can guide you a little bit.
2. Its really none of their business. If you claim exempt but were not, its your tax liability, not the business's....Show more