Employees Likely to See Slight Federal Tax Increase on Paycheck - 01/21/10
The reduction in payroll taxes extended to most Purdue employees last year per the American Recovery and Reinvestment Act, known as the “stimulus plan,” applied to 2009 wages only. New tax tables went into effect Jan. 1, 2010. Thus, according to the University Tax Department, beginning with the first pay of 2010, most employees will see an increase in their federal withholding and an equivalent decrease in their take-home pay.
Employees may make adjustments in their withholding by completing and submitting a new Form W-4 to the Tax Department. The form is available on the Tax Forms for Resident Employees page of the Taxes Web site. The number of withholding allowances, Line 5, as well as an additional amount withheld from each paycheck, Line 6, can be changed.
County taxes also have changed for Carroll, Clark, Clay, Madison and Wabash counties.
According to the Tax Department, the federal tax tables are adjusted nearly every year. The 2010 Federal Tax Table is available on the Tax Department Web site. For additional help, view IRS Publication 919, How Do I Adjust My Tax Withholding? or visit the Internal Revenue Service Web site and use the Withholding Calculator.
For more information concerning payroll taxes, please contact the Tax Department at email@example.com or 496-2303.