Purpose
To advise agencies of increases in withholding allowances
Affected Employees
All employees
Effective Date
Immediately
Background
New rates will be reflected in the Administration checks dated January 3, 2001 and Institution checks dated January 11, 2001.
Tax Tables
The value of a withholding allowance has been increased to $55.77 weekly, $111.54 biweekly, $241.67 monthly and $2,900 annually. To request a copy of the Circular E, Employer's Tax Guide, contact the IRS at the toll free number 1-800-829-3676 or visit their website at www.irs.gov to view this publication.
The New York State Payroll System calculates taxes based on the annual table.
Advance Payment of Earned Income Credit
In 2001, employees whose earned income is less than $28,281 may be eligible for the advance payment of the Earned Income Credit (EIC), with a maximum credit of $1,457. The new 2001 tables for calculating the credits may also be accessed as indicated above.
Eligible employees must complete a new W-5, Earned Income Credit Advance Payment Certificate each year. Copies of the forms may be obtained from IRS.
Questions
Questions regarding this bulletin may be directed to the Payroll Deductions mailbox.