Worksheet to Estimate Payroll Withholding Deduction

 Year  2007: Instructions for using the Withholding Tax Chart

Before using one of the tax charts shown below, it is necessary to annualize the wages subject to withholding.

1.       Subtract from the gross earnings (per pay period) any contributions made to tax-deferred payroll deduction(s) such as a retirement, annuity (SRA), health premium, parking or dependent care deferred deductions.  This amount will be the gross wages subject to withholding per pay period.

2.       Multiply this amount by 24 – the number of pay periods in a year. This figure is the estimated annualized gross income subject to withholding.  Some tenured faculty should multiply by 18 – check with Payroll Services if questions.

3.       Multiply the number of exemptions claimed on the W-4 by $3400.00, and subtract the result from the annualized gross income obtained in Step #2 above.  This figure is the one to use with the tax chart. The current W-4

      status and exemptions are printed on the bottom of the payroll earnings statement.

4.       After using the chart to determine the amount of withholding, divide the withholding amount by the same number of pay periods used to multiply with in Step #2.  This amount will be the withholding tax deducted each pay period.

EXAMPLE:   Employee claiming Married with 2 exemptions paid on 24 period schedule;

ANY CHANGES TO GROSS WAGES, NUMBER OF EXEMPTIONS, OR

     TAX DEFERRED DEDUCTIONS WILL CHANGE THE AMOUNT OF WITHHOLDING TAX 

Current Supplemental Withholding Tax Rate:   25%