Payroll System Replacement Project

Subject: Claiming Exempt From Withholding Bulletin No. 88
Date:    3/30/99
PURPOSE

The purpose of this bulletin is to explain the procedure for the annual review of employees who claim exempt from Federal and/or State withholding.

REQUIREMENTS

Internal Revenue Service regulations require anyone claiming Federal tax exempt status to file a new W-4 by February 15 each year. New York State Department of Taxation and Finance regulations require anyone claiming State tax exempt status to file a new IT-2104-E by April 30 each year. The W-4's and IT-2104-E’s for the current year’s exemption are to be retained in the employee’s payroll office.

REPORT

A report (NPAY738) identifying employees in your agency claiming Federal and/or State exempt status will be provided in a separate mailing.

If any employee identified as claiming exempt from Federal withholding does not provide you with a new W-4, their status must be changed to ‘Single 0' on the Federal Tax Data 1 Panel.

If any employee identified as claiming exempt from State withholding does not provide you with a new IT-2104-E, their status must be changed to ‘Single 1' on the State Tax Data 1 Panel.

Questions concerning this bulletin should be directed to Denise Shoddy at (518) 473-6336.