COMPTROLLER. MARYLAND

(1)

MARYLAND

Sevrtt'ng the People Robert

J.

Murphy

Director Central Payroll Bureau

TO:

All State Agencies

FROM:

Robert

J.

Murphy, Director

Central Payroll Bureau

DATE:

January

23, 2014

SUBJECT:

2014

Federal Income

Tax

Withholding Information

The Percentage Method

of

Withholding is addressed in this memo which includes extractions from the

2014

Federal Income Tax Withholding Tables (found in the

IRS

Publication

15,

Circular

E-Employer's Tax Guide).

Please Note:

~ Advance payment

of

earned income credit (EIC)through payroll payments expired on December

31,

2010.

Individuals eligible forEICin 2013can still claim the credit when they file their 2013federal income tax return. Additionally any employee who expects to be eligible for the EICand will have income tax withheld I'rom _wages in 2014may reduce their withholding in order to receive the benefit

of

a portion

of

the credit throughout the year.

~ The annual personal exemption amount for

2014

will be $

3,950.00.

~ _{Tax calculations} and estimates

of

net pay can be readily determined by using the

Cenhal Payroll Bureau Net

Pa

Calculator located on the home page

of

our web

site-htt://Com

troller.Mar landtaxes.com/Government Services/State Pa roll Services/

~ Other important links located on our home page are:

2014

Federal Withholding Tables

2014

Maryland Withholding Tables

Annapolis Data Center, PO.Box2396,Annapolis, Maryland 21404-2396 410-260-7401'-888-674-0019(MD)

Fax:410-974-2473'aryland Relay 711

'TY

410-260-7157 'pbtacomp.state.md.us

(2)

ALLOWANCE

TABLE

Dollar Amount ofWithholdtng Allowances

Number

of

Biweekly Monthly

Withholding Pay Period Pay Period

Allowances

0

$

0

$ 0 I

151.90

329.20

2

303.80

658.40

3

455.70

987.60

4

607.60.

1,316.80

5

759.50

1,646.00

6

911.40

1,975.20

7

1,063.30

2,304.40

8

1,251.20

2,633.60

9

1,367.10

2,962.80

10

1,519.

00

3,292.

00

Over

10

—

Multiply amount

of

one withholding allowance

($

151.90

for bi-weekly or $

329.20

for monthly) by the number

of

Allowances claimed.

The annual personal exemption amount

of

$

3,950

equals the Bi-Weekly amount

of

$

151.90

(1

exemption) multiplied by

26,

rounding to nearest whole dollar,

or

the Monthly amount

of

$

329.20

(1exemption) multiplied by 12,rounding to nearest whole dollar.

NOTE:

Use

of

these tables to compute estimated tax withholdings will result in amounts that differ slightly (by afew cents) from the precise amounts computed by the Statewide Payroll System

(3)

2014

Federal Income

Tax

Withholding

Information

Tax

tables

for Percentage

Method

of

Withholding

BIWEEKLY

Pa

roll

Period

Single

Person

—

Including Head

of

Household

Taxable Income*

Amount

of

Income

Tax

Withheld

is:

Not over $87

0

Over-

But

not over-

of

excess

over-$87 -$

436...$

0.00

plus

10%

-$

87 $

436

-$

1,506...

$

34.90

plus

15%

-$436

$

1,506

-$

3,523...$

195.40

plus

25%

-$ 1,506

$

3,523

-$

7,254...

$

699.65

plus

28%

-$3,523

$

7,254

-$

15,667...$

1,744.33

plus

33%

-$7,254

$

15,667

-$

15,731...$

4,520.62

plus

35%

-$ 15,667

$

15,731.

$

4,543.02

plus

39.6%

-$ 15,731

Married

Person

Taxable Income*

Amount

of

Income

Tax

Withheld

is:

Not over $325 0

Over-

But

not over

of

excess

over-$325

-$ 1,023

...

$

0.00

plus

10%

-$325

$ 1,023

-$

3,163...$

69.80

plus

15%

-$ 1,023

$

3,163

-$

6,050...

$

390.80

plus

25%

-$

3,163

$

6,050

-$

9,050...

$

1,112.55

plus

28%

-$

6,050

$

9,050

-$

15,906...

$

1,952.55

plus

33%

-$

9,050

$

15,906

-$

17,925...

$

4,215.03

plus

35%

-$

15,906

$

17,925.

.$4,921.68

plus

39.6%

-$ 17,925

*-

_{Bi-weekly gross pay} less

tax

sheltered and/or

pre-tax

deductions and

the dollar

amount

of

Biweekly withholding allowances. NOTE;

~ 1nflation adjustments have increased the above Tax

Bracket

thresholds

for

each filing status ~ Use

of

these tables to compute estimated tax withholdings will result in amounts that differ

slightly (by

a

few cents) from the

precise

amounts computed by the Statewide Payroll

(4)

2014 Federal Income Tax

Tax

tables

for Percentage

Method

of

Withholding

MONTHLY

Pa

roll

Period

Single

Person

—

Including Head

of

Household

Taxable Income*

Amount

of

Income

tax

Withheld

is:

Not over $ 188

.0

Over-

But

not

over-

of

excess

over-$ 188

-$

944...$

0.00

plus10%

-$ 188

$

944

-$

3,263...

$

75.60

plus

15%

-$944

$

3,263

-$7,633

...

$

423.45

plus

25%

-$3,263

$

7,633

-$

15,717...

$

1,515.95

plus

28%

-$7,633

$

15,717

-$

33,946...

$

3,779.47

plus

33%

-$

15,717

$

33,946

-$

34,083...

$

9,795.04

plus

35%

-$

33,946

$

34,083

$

9,842.99

plus

39.6%

-$34,083

Married Person

Taxable Income*

Amount

of

Income

Tax

Withheld

is:

Not over $

704

.0

Over-

But

not over-

ofexcess

over-$

704

-$2,217

...

$

0.00

plus

10%

-$704

$

2,217

-$

6,854...

$

151.30

plus

15%

-$

2,217

$

6,854

-$

13,108...

$

846.85

plus

25%

-$6,854

$

13,108

-$

19,608...

$

2,410.35

plus

28%

-$

13,108

$

19,608

-$

34,463...

$

4,230.35

plus

33%

-$ 19,608

$

34,463

-$

38,838...

$

9,132.50

plus

35%

-$34,463

$

38,838

. $

10,663.75

plus

39.6%

-$

38,838

*-

_Monthly _{gross pay} less

tax

sheltered and/or

pre-tax

deductions and the

dollar

amount

of

Monthly withholding allowances.

NOTE:

~ Inflation adjustments have

increased

the above Tax

Bracket

thresholds

for

each filing status ~ Use

of

these tables to compute estimated tax withholdings will result in amounts that differ

slightly (by

a

few cents) from the

precise

amounts computed by the Statewide Payroll

(5)

2014

Federal Income

Tax

Withholding

Information

Exantyles

of

8'ithholding Calculations using the

Percentage

Method

1.

A married employee is paid $

1,356.09

bi-weekly. This employee has in

effect

a Form W-4

claiming

(0)

withholding allowances. The employee also has a deferred comp deduction.

Using the percentage method, the income tax towithhold is computed as follows: Total wage payment $

1,356.09

(0)

allowances claimed on W4 $

0.00

Deferred Comp deduction $

60.00

Amount subject to withholding $

1,296.09

(Subtract lines 2

&

3 from line

1)

BIWEEKLY

Pa

roll

Period

for married Person.

$

1,296.09

falls within the range

of

$ 1,023 -$

3,163,

the following calculation:

$

69.80

plus

15%

of

the amount over $

1,023

$

1,296.09

—_$

1,023

=

_$

273.09

$

273.09 X

0.15 =

$

40.96

Add $

69.80+

$

40.96

=

$

110.76

Total Federal

Tax

tobe withheld

2.

An unmarried employee is paid $

4,000.00

monthly. This employee has in effect a Form W-4

claiming

(2)

withholding allowances.

Using the percentage method, the income tax towithhold is computed as follows: Total wage payment $

4,000.00

(2)

allowances claimed on W4 $

658.40

(From the Allowance table)

Deferred Comp deduction $

0.00

Amount subject to withholding $

3,341.60

(Subtract lines 2

&

3from line

1)

MONTHLY Pa

roll

Period

for unmarried Person.

$

3,341.60

falls within the range

of

$

3,263

-_$

7,633,

_{use the} _following _calculation:

$

423.45

plus

25%

of

the amount over $

3,263

$

3,341.60

-$

3,263

=

$

78.60

$

78.60

X

0.25

=

$

19.65