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Date: December 28, 2011

Bulletin Number: 1121

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Subject

Summary of Tax Related Withholding Requirements for 2012

Purpose

To inform agencies of the tax related withholding requirements for 2012.

Affected Employees

Employees receiving paychecks in 2012.

Effective
Date(s)

January 1, 2012

Social
Security

The Social Security wage base limit is increased to $110,100 for 2012.

The Temporary Payroll Tax Cut Continuation Act of 2011 temporarily extends the current employee social security tax withholding rate of 4.2% through February 29, 2012.

An additional bulletin will be issued in late February in the event
the employee social security tax withholding rate is changed from 4.2% after February 29, 2012.

Note: Per the IRS, this reduced Social Security withholding rate has no effect on employees’ future Social Security benefits.

The employer social security tax withholding rate is 6.2% for 2012.

Medicare

There is no wage base limit for Medicare tax. 

The Medicare tax withholding rate is 1.45% each for the employee and the employer.

Federal
Withholding
Allowance

The value of one Annual Federal Withholding Allowance is increased to $3,800. 

Federal
Withholding
Rates

The Federal income tax withholding rates have changed for 2012.   The new withholding rates can be located in IRS Publication 15, (Circular E), Employer’s Tax Guide.  

To access this publication, visit the Internal Revenue Service website at www.irs.gov and select Forms and Publications>View online: Tax Publications>Publication 15.

New York State,
New York City and Yonkers Withholding Allowance

The value of one New York State, New York City and Yonkers Withholding Allowance remains at $1,000.

 

New York State,
New York City and Yonkers Withholding Rates

The New York State, New York City and Yonkers withholding tax tables have been revised for 2012.

Please refer to the following publications accessible at the NYS Department of Taxation and Finance website at www.tax.ny.gov for additional information.

NYS-50-T-NYS

New York State Withholding Tax Tables and Methods

NYS-50-T-NYC

New York City Withholding Tax Tables and Methods

NYS-50-T-Y

Yonkers Withholding Tax Tables and Methods

OSC
Actions

OSC will update PayServ with these tax related updates for 2012.

Agency
Actions

Informational only.

Questions

Questions regarding this bulletin may be e-mailed to the Tax and Compliance mailbox.