How to Clear or Update Last Year's Tax Exemptions

Employees use the Tax Withholding task from their Me page to specify their W-4 exemptions and other federal fields that affect the calculation of taxes. Because the exemption statuses for federal and some state taxes expire after a year, the employee must submit new Form W-4s by the IRS deadline to renew them.

Consider issuing reminders to your employees to renew these exemptions.

Use the Start-of-Year Process flow in Draft mode to generate a report that identifies the employees with Exempt status. Use this flow as verification prior running in final mode. When you run it in Final mode, it removes the exemptions and date stamps them with the effective date you select in the parameters.

For those employees who want to renew their exemptions, you must apply them based on each person's W-4.

1. Open the person's Tax Withholding card for editing.

2. Open the Federal component for editing.

3. Set a date for the change.

4. In Other Exemptions, specify the appropriate exemptions.

5. Save and submit your changes.