at the bottom of this screen for detailed training information and tutorials on using this feature.You can access the Withholding & Taxes view from the People icon.
The Withholding & Taxes category allows you to view tax filing status information entered from W-4 and/or state filing forms. This information is used to perform payroll tax calculations and populates some of the tax forms that Paychex provides.
When this view is selected on an existing worker, a table displays with all of the applicable taxes for the worker. A + sign may appear next to the tax type name if there are multiple components to the tax; select the + to expand the listing.
The tax table includes the Category of the tax, the state name if applicable, a brief recap of the withholding basis for the agency and other withholding information where pertinent.
Select Edit next to any of the taxes to edit the specifics for the given tax on the worker.
Click at the bottom of this screen for detailed training information and tutorials on using this feature.
|
Term |
Description |
|
Exempt |
Wages paid to all employees are exempt from the tax but wages may be reportable as exempt compensation. If exempt at the company level, all employees are exempt. |
|
Withhold |
Wages paid to employees are subject to the tax and are reportable as taxable compensation. |
|
Taxable |
Wages paid are subject to the tax, but tax is not withheld. |
|
|
Contact your local Paychex representative to make modifications for Exempt employees. |
Backup withholding is income tax withholding required from non-employee compensation when the payee fails to furnish the payer with a taxpayer identification number (TIN) or the payer is notified by the IRS that the payee’s TIN is incorrect.
Employees can only be set up for states that have been set up at the company level. If you do not see the state or local agency you are trying to set up for your employee, call your service location for assistance to ensure that taxes are calculated accurately.
Dual State Employees
Select the employee from the People list, then select Withholding & Taxes under the Views tab, and click 
to add a state. In the Percent Worked field for each state, enter the states that the employee works in and the percentage of time worked for each. The employee's wages will be broken out using these percentages. These percentages can be modified in pay entry when necessary.
If there is not a standard split of the employee's time, set the employee up for the second state. Enter 100% for the resident state and 0% for the nonresident state. You can then allocate wages by selecting Edit in pay entry.
Employees can only be set up for locals that have been set up at the company level. If you do not see the state or local agency you are trying to set up for your employee, call your service location for assistance to ensure that taxes are calculated accurately.
Local Taxes
The term “local taxes” describes any tax below state level that is imposed by a city, county, school district, transit district, or any other government unit. When an employer does business in a location with local taxes, the employer may be required to:
withhold local income taxes from employees living or working within a taxing jurisdiction
withhold local occupational fees from employees’ wages for the privilege of working within the taxing jurisdiction, or
pay local taxes on total payroll (payroll expense taxes).
Percent of Earnings Taxed
When an employee is set up with more than one local, enter the sum of the Percent of Earnings Taxed for each local except for PA Act 32 locals. The percentages entered in each local should equal 100%.
Pennsylvania Locals
When an employee is set up for more than one Pennsylvania local (Act 32 or non-Act 32), the total of the Percent of Earnings Taxes cannot be more than 100% for the following locals:
Philadelphia local income tax regulation set up as Non-resident
Pennsylvania local income tax regulation that follows Act 32 legislation and the employee's Work/Live status for the regulation is:
works here/lives in a different PA local
or
works and lives in this local
or
works here/lives out of state
