Configure State Tax Withholding for Courtesy Taxes

The US Oracle payroll tax engine (USOPTE) provides the tax data that determines:

• What resident state taxes the payroll process withholds for employees

• When it withholds them

Each state has its own withholding and reciprocity rules.

These tax withholding rules determine the resident wage accumulation rules available to you.

However, as their employer, you may not be required to withhold resident state taxes. In such cases, the withholding is considered a courtesy.

When using the Only states under state tax rules withholding rule on the federal income tax (FIT) component of the organization calculation card, select the appropriate resident wage accumulation rule for each state. You can also configure the resident wage accumulation rule on the employee's Tax Withholding card.

If you're using this withholding rule	It does this	And you can select this for Resident Wage Accumulation
All states	Default withholding rule for all states.	The payroll process automatically withholds for all states using the default action for each state.
Only states under state tax rules	From the states you have configured on the card, this identifies which you're withholding resident taxes. For each state you add, you select the appropriate resident wage accumulation rule.	The field displays the values appropriate for the selected state. Select one: Calculate tax independent of all other jurisdictions Credit resident tax by work tax, accumulate wages if taxed Credit resident tax by work tax. Accumulate wages if work tax not withheld Credit resident tax by work tax, always accumulate wages No resident tax if work wages exist, always accumulate wages No resident tax if work or residence mismatch, accrue if taxed No resident tax if work tax greater than zero No resident tax if work tax greater than zero, always accrue No resident tax if work tax on nonresident, accrue if taxed No resident tax if work tax on nonresident, always accrue Use default action