Purpose

To explain the procedure for the annual review of employees who claim to be exempt from Federal and State withholding.

Affected Employees

Employees claiming to be exempt from tax withholding.

Background

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, annually.

The W-4's and IT-2104E's for the current year's exemption are to be retained in the employee's payroll office.

Reveal Report

Reveal Report, NPAY738, identifies employees in your agency claiming Federal and/or State exempt status.

Agency Actions

If any employees identified as claiming exempt from Federal withholding do not provide a new W-4 by February 15, 2003, change their status to 'Single 0' on the Federal Tax Data 1 Panel.

If any employees identified as claiming exempt from State withholding do not annually provide a new IT-2104-E, change their Status to 'Single 1' on the State Tax Data 1 Panel.

Questions

Questions regarding this bulletin may be directed to the Payroll Deductions mailbox.