Tax Withholding Card Tax and Wage Accumulation Exemptions
On the Tax Withholding card, each federal income tax (FIT) and state income tax (SIT) component has a Withholding Exemption section. To exempt an employee from tax withholding or wage accumulation, mark one of the following as Yes.
Field name |
What it does |
---|---|
Exempt from (component) Income Tax |
Excludes this tax from withholding. |
Exempt from Wage Accumulation |
Excludes this tax from withholding, and doesn't accumulate wages for the component. For purposes of exempting an employee from SIT due to a military spouse situation, mark this as Yes for the state component if:
|
For FIT, if you mark both as exempt, the payroll process ignores Exempt from Wage Accumulation.
For SIT, if you mark both as exempt, the process honors both.