To submit a change to your withholdings please complete the Employee Action Request form:
Employee Action Request Form Adobe Sign
What should I know about the new Employee Action Request (EAR) tax fields?
Field Name Value Higher Withholding Indicator (HW). N (NO), Y (YES) Dependent Amount (DEP AMT) Numeric, whole number. Other Income (OTH INCOME) Numeric, decimal allowed, 8 digits (999999.99). Deductions (DEDUCTIONS) Numeric, decimal allowed, 8 digits (999999.99).
Can an employee claim exemptions/allowances for federal on or after 12/01/2020?
No. Effective 12/01/2020 employees cannot claim exemptions/allowance for Federal withholding. See IRS Publication 15-T, and 2020 W-4 FAQs https://www.irs.gov/newsroom/faqs-on-the-2020-form-w-4.
New EAR form has ‘Head of Household’ as an option filing status for Federal withholding; is this new?
Yes. Filing status ‘Head of Household’ is new for Federal withholding and can be used effective 12/01/2020.Refer to the link for more information. https://www.irs.gov/pub/irs-pdf/p15t.pdf
What value(s) are allowed for Higher Withholding (HW)?
The value for HW must be N or Y. N (NO) means no to higher withholding. Y (YES) means yes to higher withholding. Refer to IRS website for withholding rates. https://www.irs.gov/pub/irs-pdf/p15t.pdf
Can the HW field be left blank?
The HW field cannot be left blank if processing tax changes effective 12/01/2020 and after. The HW field must be completed with N or Y.
Can an employee claim exemptions/allowance for State withholding?
Yes. Employees can continue to claim exemptions/allowances for State withholding. See EDD Form DE4 and CA Withholding Schedules for 2020 Method B.
Should all employees submit a new EAR form effective 12/01/2020?
No. Not all existing employees need to submit a new EAR form, employees making changes to tax withholding changes or new employees hired on/after 12/1/2020 should submit the new EAR form. Refer to IRS Publication 15-T and EDD DE4.
What tools are available for employees to use when completing the new EAR form?
To get the most accurate withholding, employees can use the IRS’s Tax Withholding Estimator. https://www.irs.gov/individuals/tax-withholding-estimator. Employees can also use the paycheck calculator on the SCO’s website. https://www.sco.ca.gov/ppsd_se_paycheck_calc.html.
Can employees claim Federal Additional Deduction if claiming exemption from Federal only?
Yes. Employees can claim Federal Additional Deduction.
How does the HW box work?
Essentially, the tax tables divide the standard deduction and tax brackets equally between two jobs, so that tax rates apply at roughly half of the income threshold that normally applies.
For example, for the Married Filing Jointly status, the 24% rate normally applies for wages over roughly $180,000, but if the HW shows “Y”, the 24% rate applies to wages over about $96,000. Refer to IRS Publication 15-T for more information.
Where can I find information/references regarding new IRS changes?
- SCO Personnel Letter #20-028 can be referenced for additional information (https://www.sco.ca.gov/Files-PPSD-Letters/Pers/2020_e20-028.pdf)
- SCO Payroll Letter #20-028 can be referenced for additional information (https://sco.ca.gov/Files-PPSD-Letters/Payr/2020_p20-028.pdf)
- IRS Publication 15-T (https://www.irs.gov/pub/irs-pdf/p15t.pdf)
- EDD DE4 (https://edd.ca.gov/pdf_pub_ctr/de4.pdf)
- 2020 Form W-4 (https://www.irs.gov/pub/irs-pdf/fw4.pdf)
- EDD Employee Withholding Allowance (https://www.edd.ca.gov/Payroll_Taxes/Rates_and_Withholding.htm#de4)
- EDD California Withholding Schedule Method B (https://www.edd.ca.gov/pdf_pub_ctr/20methb.pdf)