Key points about state W-4 forms and income tax withholding:
- State W-4 forms tell you how much state income tax to withhold from each employee’s pay.
- States without income tax do not require state withholding tax forms.
- You can use the chart below to quickly find your state’s Form W-4.
Each year, your employees complete a Federal Form W-4 that helps you understand how much Federal income tax to withhold from their wages. Depending on where your employees live, you may also need to collect a state-specific Form W-4.
What is a state W-4 form?
A state W-4 form collects information that tells you how much state income tax to deduct and withhold from each employee’s pay. It may also include information for city, county, and local income taxes where applicable.
Please note that each state may have a different name for this form. Your state may not call the form a state W-4, even though it collects the same type of information.
What type of information does a state W-4 form collect?
A state Form W-4 typically collects information like each employee’s:
- Personal data (name, address, Social Security Number)
- Filing status
- Dependents (if applicable)
- Deductions and withholdings (if applicable)
Is there a difference between a state Form W-4 and the Federal Form W-4?
Yes. While a state Form W-4 functions similarly to the Federal version, there are differences. For one thing, most employees need to complete a Federal Form W-4, but not everyone needs to complete a state Form W-4. In addition, a Federal Form W-4 tells you how much Federal income tax to withhold from each employee’s pay. A state Form W-4 tells you how much state income tax to withhold.
What’s the difference between Form W-4 and Form W-2?
Federal and state W-4 forms tell employers how much income tax to withhold from each employee’s pay. These forms are completed by employees.
W-2 forms, on the other hand, report an employee’s annual wages and the amount of taxes withheld from their paycheck each year. Employers complete W-2 forms and send them to their employees and the Social Security Administration.
When do you need to collect state W-4 forms?
In general, you need to collect state W-4s whenever:
- You hire a new employee
- An employee experiences a life event that affects their withholding (like getting married or having a child)
- An employee wants to change their withholding (for example, they may want to increase how much is withheld based on other forms of income)
The IRS recommends that employees revisit their W-4 forms each year to make sure all of the information is still accurate. As such, you’ll want to collect an updated state Form W-4 any time an employee makes a change.
What states don’t require a state W-4 form?
States that do not require a state W-4 fall into three general categories:
1. States without state income tax.
These states include:
- New Hampshire
- South Dakota
2. States that tax income at a flat rate.
This currently only applies to Pennsylvania.
3. States that use the Federal Form W-4 to calculate state income taxes.
Some states let you calculate an employee’s state income tax withholding using the Federal Form W-4. In these states, a state-specific form is generally not required. These states include:
- New Mexico
- North Dakota
W-4 withholding forms by state
For states that have withholding tax, you can use the chart below to find the respective tax form. Please note that many states update their forms each year. Always check your state’s Department of Revenue for the most recent version.
Simplify payroll & tax filing
There are so many payroll and tax-related forms that keeping track of them all can be overwhelming. After all, you need to know:
- Which form to use for which situation
- Whether you’re using the most updated version
- Who needs to complete the form
An HRIS like SentricHR makes all of this easier. For one thing, you can find essential documents like the most up-to-date versions of Form W-4 and Form I-9 directly in the software. You can also create, manage, store, and sign all of your documents in one place. To learn more about how SentricHR can streamline your document management, schedule a free demo today!
If you’re looking for more handy information about all things payroll and tax-related, check out our Guide for Payroll Professionals: What You Need to Know About Payroll, Taxes, & Compliance. This guide gives you a comprehensive look at payroll and tax legislation, wage rates, deductions, contribution limits, tax forms, and more so you can stay compliant and manage payroll easily!
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