Employee Tax

Purpose: This tab is where you will store tax types, withholdings for state and federal, and tax exemptions. This guide will show you how to add and edit this tax information.

Add Employee Tax

Click “Edit” to add or update employee tax information.

  1. Home Address: Automatically populated from the General tab. The location code is used to determine possible taxes to be taken.
  2. Work Address: Select the address type (Company, Branch, Home, or Other) and the address will automatically populate or you will be able to manually enter it, depending on your selection. In most cases, the work address is what the employee's taxes are based on.
  3. State Unemployment Insurance: Employees are set to work in only one state for withholding and unemployment taxes per payroll run, though those states can differ. For example, an employee can have income tax withholding in California and unemployment tax in Oregon.
    • Exempt from State UI Tax: Check this box if the employee is exempt from State Unemployment Insurance Tax.
    • State UI is: Select if this applies to the employee’s work address, home address, or California.
  4. Federal Withholding 
    • Ignore filing status/exemption: Check this box to have no federal income tax taken or a specified dollar amount entered. Wages are reported to the IRS.
    • FICA Exempt: Check this box to have no Social Security or Medicare taxes taken or reported.
    • FUTA Exempt: Check this box to have no Federal Unemployment taxes taken or reported.
    • Filing Status: Single, Married, or Married using single rate.
    • Exemption: Enter the number of exemptions.
    • Additional Withholding Type and Amount: Enter an additional withholding, if needed.
  5. State Withholding
    • State Withholding is: Select if the state withholding applies to the work address, home address, or California.
    • Ignore filing status/exemption: Check this box to have no state income tax taken or a specified dollar amount entered. Wages are reported to the state.
    • ExemptionEnter the number of exemptions.
    • Filing Status: Single, Married, or Married using single rate.
    • Additional Withholding Type, Amount and Allowances: Enter the additional withholding information, if needed.

Click “Save” at the top of the page to save the employee’s tax information.

Tax List

  1. Add Custom Tax: Click here to add additional taxes that aren’t normally calculated based on the employee’s home or work location.
  2. Exclude Tax Selected: Check the box next to the taxes you’d like to exclude. Then click the “Exclude Tax Selected” button. Wages on excluded taxes are not reported to the IRS or states.

What's Next?

Do you need to add company tax information?

Need help editing taxes in the Payroll Center?

Do you need to add employee wages?