"Payroll Withholding Taxes" Archive

New state tax form required for all employees

December 13, 2013

Resulting from the North Carolina Tax Reform Law passed earlier this year, the state’s Department of Revenue recently notified employers that all employees must complete a new “Employee’s Withholding Allowance Certificate.” You may choose to complete the Form NC-4 EZ or the Form NC-4.

Please complete and sign the appropriate form and submit to Payroll or Human Resources by 5:00 p.m. on December 20, 2013, either by scanned copy through email to payroll@wfu.edu or by mail. If your form is not received by December 20th, Payroll is required to withhold North Carolina taxes at the single status with zero allowances.

A Frequently Asked Questions document is available from the Department of Revenue, and additional information is included below. They also have an NC-4 Form call-number to answer your questions on how to complete the form; that number is (877) 252-4487.

As provided by the North Carolina Department of Revenue:

The North Carolina General Assembly recently enacted House Bill 998, which becomes effective for taxable years beginning on or after January 1, 2014. Under this new law, all taxpayers will pay a lower rate and be granted a higher standard deduction. Taxpayers may no longer claim a personal exemption for themselves, their spouse, children, or any other qualifying dependents. Additionally, many deductions and tax credits that impact North Carolina withholding tax are no longer available for tax years beginning on or after Jan. 1.

North Carolina allowances are no longer available for spouses, dependents over age 17, or for all income levels; therefore, your determination of allowances for tax year 2014 will differ from previous years. Most taxpayers will not be entitled to as many allowances and, as a result, more taxpayers will claim zero allowances. Although the state income tax is decreasing to a uniform rate of 5.8% and the allowance method is changing, employees may see an increase or decrease in tax withholding next year.

If you have questions, please contact Payroll at 336-758-2960 or email at payroll@wfu.edu.

Payroll tax changes effective Jan. 1

January 7, 2013

On Jan. 1, 2013, Congress approved the American Taxpayer Relief Act of 2012.  This bulletin provides information on how this legislation will affect taxes deducted from paychecks beginning this month.

Social Security tax:

Because of the expiration of the “Middle Class Tax Relief and Job Creation Act,” the Social Security tax rate will increase as of Jan. 1, 2013. As a result, the Social Security tax rate reverts to 6.2% of your pay compared to the 2011 and 2012 temporary rate of 4.2%, an increase of 2%.

Federal Income tax rates:

The federal government provides every January new withholding tax tables to all employers based on the tax rates that will be in effect for the new calendar year. Your withholding may change impacting your first paycheck in January 2013.

The tax rates in effect for 2013 are summarized in the table below.

 
You may update your federal and/or state income tax withholding allowances at any time.

W-4 Employee’s Withholding Allowance Certificate »
NC-4 Employee’s Withholding Allowance Certificate »

* Beginning in January 2013, individuals whose annual wages and compensation paid in excess of $200,000 will be subject to an additional 0.9% Medicare Tax, from 1.45% to 2.35%.  The additional withholding will be reflected in the pay period in which an employee’s compensation exceeds this threshold.  For more information, please refer to the IRS website:  http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Questions-and-Answers-for-the-Additional-Medicare-Tax

If employees have any questions regarding this bulletin, please contact payroll@wfu.edu.

Payroll Withholding Taxes/Mileage Reimbursement changes for 2011

January 7, 2011

Finance and Accounting Services and Human Resources are providing this information to inform employees of 2011 payroll withholding changes and an increase in the mileage reimbursement rate.

Payroll Withholding Taxes

The Federal Withholding Tax tables substantially changed for 2011.  Included in the changes is a decrease in the Social Security withholding rate from 6.2% to 4.2%.  This decrease is a result of a federal tax bill that was passed in late December.  A few highlights of the 2011 tax changes and how they may impact the Wake Forest community are as follows:

• Faculty and staff may see an overall increase in their net pay check due to the 2% reduction in Social Security taxes.
• Employees earning less than $84,000 per year will likely have a small federal income tax withholding increase, due to expiration of the “Making Work Pay Credit.”  However, this increase may be offset due to the reduction in Social Security taxes.
• Advanced Earned Income Credit has also expired, increasing federal tax withholding for those people who used it. Again, this increase may be offset by the reduction in Social Security taxes.

Most students will probably see an increase in their tax withholdings due to the expiration of the “Making Work Pay Credit.” Generally,  students do not pay Social Security tax, so they will not benefit from the reduction in Social Security taxes.
Mileage Reimbursement Rate Increase

Effective January 1, 2011, the Internal Revenue Service increased the maximum tax free mileage reimbursement rate to 51 cents up from 50 cents per mile.  The University is adopting this new rate for all business travel that occurs on or after January 1, 2011. Please use the new reimbursement rate of 51 cents when preparing expense vouchers.

An updated travel form will be published on the Financial and Accounting Services website under “Travel and Entertainment Voucher.” Please use the voucher that corresponds with the appropriate travel dates.  If you have any questions, please contact an Accounts Payable Representative.

If you have questions, please contact Human Resources at 758-4700 or askhr@wfu.edu or Payroll at 758-4741 or payroll@wfu.edu.