CE-PR034
Arizona Employee Withholding
Modules Affected:
Versions Affected:
Payroll
Version 6 and 7 (7.6c3.19, 9.6c3.19, 8.7c2.19; 9.7c2.19)
The discussion of this new feature is divided into the sections shown below.
Background ................................................................................................................... 1
Updating Employee Information ............................................................................. 1
Background
Payroll tax withholding by the State of Arizona is based on a percentage of Federal tax
withheld. Arizona recently changed the withholding rates from whole numbers (10%, 20%,
etc.) to decimal percentages (18.2%, 21.3%, etc.). This necessitated a change in Payroll tax
calculations and the way employees with AZ withholding are set up in Employee F/M. Prior
to this change, the number of personal exemptions in the state withholding information in
the Employee File corresponded to the withholding percentage. Since this field does not
permit decimal numbers, the system was changed to look up the withholding percentage
that corresponds to the number entered in the Personal Exemptions field.
Note:
These percentages may change in the future, or additional withholding levels may be added
to the list. Please consult the Tax Notes on SHAKER’s web site for the latest information
(http://www.shakercomputer.com/support/supportfaq/taxnotes.html).
Updating Employee Information
Follow the instructions enclosed with the update media to install the updated programs
and tax tables.
8/12/2003
©Shaker Computer & Management Services, Inc.
1
CE-PR034
Arizona Employee Withholding
Once the update is installed, go into the Employee F/M and update the State Personal
Exemption information for each employee with AZ withholding. This field is highlighted in
Figure 1: Fed/State screen in Employee F/M.
Figure 1: Fed/State screen in Employee F/M
07/23/03
PR - Employee F/M
SHAKER
Change
9.75.1.2
┌───────────────────────────────────────────────┐
│ Employee* 12999877 CARR, MADISON
│
└───────────────────────────────────────────────┘
┌────────────────────────────────────────────────────────────────────────────┐
│Federal Withholding Information
State Withholding Information
│
│
│
│Number of exemptions:
0
Home State*
AZ
│
│Exempt (Y/N):
N
Default Work State*
AZ
│
│Extra withhold amount:
0.00 Time Card default rule:
J
│
│Extra withhold percent:
0.00
Number of exemptions:
0
│
│Federal Filing Status:
Number of personal exem:
2
│
│FICA Exempt (Y/N):
N
State Filing Status:
│
│FUTA Exempt (Y/N):
N
Exempt (Y/N):
N
│
│EIC Eligible (Y/N):
N
Extra exemption amount:
0.00 │
│EIC Claimed by Spouse (Y/N): N
Extra withhold amount:
0.00 │
│
Extra withhold percent:
0.00
│
│
Tax distribution method:
1
│
└────────────────────────────────────────────────────────────────────────────┘
Field Definitions (selected fields)
Number of personal exem
Using the information in Table 1, select the Personal Exemption number that
corresponds to the employee’s withholding percentage (as specified on the employee’s
Arizona Form A-4).
Table 1: Withholding Percentage/Personal Exemption Cross Reference
Arizona Withholding Percentage
as selected by the employee
8/12/2003
Personal Exemption
as set in COINS
10% of Federal withholding
1
18.2% of Federal withholding
2
21.3% of Federal withholding
3
23.3% of Federal withholding
4
29.4% of Federal withholding
5
34.4% of Federal withholding
6
2
CE-PR034
Arizona Employee Withholding
If Arizona adds or changes withholding percentages, COINS will be updated to
associate the personal exemption numbers with the updated percentages, and
additional numbers may be added to this list. Check the Tax Notes on SHAKER’s
web site for up-to-date information:
http://www.shakercomputer.com/support/supportfaq/taxnotes.html.
8/12/2003
3