Employee Tax Witholding Information
Federal, State and County Tax Withholding
In compliance with State and Federal regulations, the University withholds income tax from wage and salary payments made to employees. Refer to the most recent withholding tables posted on the Tax Department website to determine the amount of tax to be withheld from an employee's salary or wage payments.
- All employees must complete an Employee's Withholding Allowance Certificate (Department of the Treasury Form W-4) to be used in determining the proper federal income tax to be withheld from their salary and wage payments.
- An employee may request that an amount in excess of the regular withholding be deducted from his/her salary by completing the appropriate form W-4 or Wh-4.
- An employee may be entitled to claim exemption from the withholding of Federal Income Tax if he/she incurred no liability for income tax for the preceding taxable year and he/she anticipates that he/she will incur no tax liability for the current taxable year. The employee will check "exempt" on the Form W-4 (Employee's Withholding Allowance Certificate) in order to claim complete exemption. This exemption does not affect the withholding of State Income Tax, Social Security Tax or Medicare Taxes. This is a yearly election which must be renewed, if desired, by February 15th of each year.
- Salary and wage payments made to Indiana non-resident employees for performing services outside the State of Indiana are exempt from the withholding of State Income Tax. Individuals in this category must file a Payroll Form 52A with the Tax Department claiming the exemption. The out of state duty station must be on file and verified by employee's department.
- Employees who are residents of Wisconsin, Kentucky, Michigan, Ohio and Pennsylvania (Reciprocal states to Indiana) may claim exemption from State Tax Withholding by completing the Certificate of Residence Form (Payroll Form 52) and returning it to the Tax Department. Local taxes are required to be withheld.
- Employees who are residing or working in one of the counties that have adopted the County Adjusted Gross Income Tax (CAGIT), the County Option Income Tax (COIT), or the County Economic Development Income Tax (CEDIT) are liable for the tax. All employees must complete Employee's Withholding Exemption and County Residence Certificate (Indiana Department of Revenue Form WH-4) at the time of employment or anytime they change counties of residence or work during the year. The county of residence and county of work, as of January 1 each year, will determine the payment or non-payment of the CAGIT and the COIT for the entire year. When a new WH4 is submitted, the year to date county taxes will be recalculated based on the new county’s tax rate back to January 1 of the current year. The effect of this county tax change will be reflected on the employee's first paycheck after the new WH4 is updated in SuccessFactors.
- Employees who are classified as non-resident aliens may be eligible to claim exemption from U.S. income tax withholding under a tax treaty between the U.S. and the country of which the non-resident alien employee is a resident. In addition, these employees may be exempt from the withholding of Social Security tax if they have an F-1 or J-1 visa. Purdue University uses a web-based tax compliance system, called Glacier, to determine the correct tax withholding for non-resident aliens. CORRECT The payroll or employment center will send the employee the link to his/her Glacier account. The non-resident alien will complete their Glacier record and send all Glacier and immigration documents required to the Tax Department.
Non-resident alien employees who do not qualify for treaty-exemption are subject to U.S. income tax withholding. These employees are required to claim "single" marital status and no additional credit or deductions, regardless of marital status.