TAXES 16-07, California State Income Tax Withholding

TAXES 16-07, California State Income Tax Withholding

Published: February 18, 2016
Effective: Pay Period 01, 2016

Summary

This bulletin supersedes TAXES 16-04, California State Income Tax Withholding dated January 11, 2016. The married tax table value has changed from $4991.36 plus 10.23% over $103,080 to $4991.36 plus 10.23% over 103,060.

All other information remains the same and is listed below.

The income tax withholding formula for the State of California includes the following changes:

No action on the part of the employee or the personnel office is necessary.

Tax Formula

State Abbreviation:

CA

State Tax Withholding State Code:

06

Acceptable Exemption Form:

DE-4 or W-4

Basis for Withholding:

State or Federal Exemptions

Acceptable Exemption Data:

S, M, H/Number of Regular Allowances/Number of Allowances

TSP Deferred:

Yes

Special Coding:

Determine the Total Number of Allowances Claimed field as follows:

First Position - Enter the employee's marital status indicated on the allowance certificate. Enter M (married), S (single), or H (head of household).

Second or Third Positions - Enter the total number of regular allowances claimed in Item 1 of the DE-4. If less than 10, precede with a 0 (zero). If no exemptions are claimed, enter 00.

Determine the Additional Exemptions Claimed field as follows:

First and Second Positions - Enter the number of allowances claimed in Item 2 of the DE-4. If less than 10, precede with a 0 (zero). If no allowances are claimed, enter 00.

Additional Information:

If the employee is using a W-4 in lieu of the California State DE-4, the information for the Additional Exemptions Claimed field should be notated on the W-4.

Withholding Formula (Effective Pay Period 01, 2016)

  1. Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
  2. Subtract the nontaxable biweekly Federal Health Benefits Plan payment(s) (includes dental and vision insurance program and Flexible Spending Account - health care and dependent care deductions) from the amount computed in step 1.
  3. Add the taxable biweekly fringe benefits (i.e., taxable life insurance) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
  4. Multiply the adjusted gross biweekly wages times 26 to obtain the gross annual wages.
  5. Determine if the employee's gross salaries and wages are less than or equal to the amount shown in the Low Income Exemption Table below. If so, no income tax is to be withheld.

    Low Income Exemption Table

    Single

    $13,419

    Married Claiming zero (0) or one (1) exemption1

    $13,419

    Married Claiming two (2) or more exemptions1

    $26,838

    Head of Household

    $26,838

    1 Number of regular allowances claimed on DE-4 or W-4.

  6. Determine the additional withholding allowance for itemized deductions (AWAID) by applying the following guideline and subtract this amount from the gross annual wages.

    AWAID = $1,000 x Number of Itemized Allowances Claimed for Itemized Deductions on DE-4 or W-4.

  7. Subtract the standard deduction shown in the Standard Deduction Table below from the result of step 6 to determine the taxable income.

    Standard Deduction Table

    Single

    $4,044

    Married Claiming zero (0) or one (1) exemption1

    $4,044

    Married Claiming two (2) or more exemptions1

    $8,088

    Head of Household

    $8,088

    1 Number of regular allowances claimed on DE-4 or W-4.

    Single Tax Withholding Table

    Taxable Wages

    Amount of Tax

    Over $0 but not over $7,850

    $0.00 plus 1.1% of excess over $0

    Over $7,850 but not over $18,610

    $86.35 plus 2.2% of excess over $7,850

    Over $18,610 but not over $29,372

    $323.07 plus 4.4% of excess over $18,610

    Over $29,372 but not over $40,773

    $796.60 plus 6.6% of excess over $29,372

    Over $40,773 but not over $51,530

    $1,549.07 plus 8.8% of excess over $40,773

    Over $51,530 but not over $263,222

    $2,495.69 plus 10.23% of excess over $51,530

    Over $263,222 but not over $315,866

    $24,151.78 plus 11.33% of excess over $263,222

    Over $315,866 but not over $526,443

    $30,116.35 plus 12.43% of excess over $315,866

    Over $526,443 but not over $1,000,000

    $56,291.07 plus 13.53% of excess over $526,443

    Over $1,000,000 and over

    $120,363.33 plus 14.63% of excess over $1,000,000

    Married Tax Withholding Table

    If the Amount of Taxable Income Is:

    The Amount of California Tax Withholding Should Be:

    Over $0 but not over $15,700

    $0.00 plus 1.1% of excess over $0

    Over $15,700 but not over $37,220

    $172.70 plus 2.2% of excess over $15,700

    Over $37,220 but not over $58,744

    $646.14 plus 4.4 of excess over $37,220

    Over $58,744 but not over $81,546

    $1,593.20 plus 6.6% of excess over $58,744

    Over $81,546 but not over $103,060

    $3,098.13 plus 8.8 of excess over $81,546

    Over $103,060 but not over $526,444

    $4,991.36 plus 10.23% of excess over $103,060

    Over $526,444 but not over $631,732

    $48,303.54 plus 11.33% of excess over $526,444

    Over $631,732 but not over $1,000,000

    $60,232.67 plus 12.43% of excess over $631,732

    Over $1,000,000 but not over $1,052,886

    $106,008.38 plus 13.53% of excess over $1,000,000

    Over $1,052,886 and over

    $113,163.86 plus 14.63% over $1,052,886

    Head of Household Tax Withholding Table

    If the Amount of Taxable Income Is:

    The Amount of California Tax Withholding Should Be:

    Over $0 but not over $15,710

    $0.00 plus 1.1% of excess over $0

    Over $15,710 but not over $37,221

    $172.81 plus 2.2% of excess over $15,710

    Over $37,221 but not over $47,982

    $646.05 plus 4.4% of excess over $37,221

    Over $47,982 but not over $59,383

    $1,119.53 plus 6.6% of excess over $47,982

    Over $59,383 but not over $70,142

    $1,872.00 plus 8.8% of excess over $59,383

    Over $70,142 but not over $357,981

    $2,818.79 plus 10.23% of excess over $70,142

    Over $357,981 but not over $429,578

    $32,264.72 plus 11.33% of excess over $357,981

    Over $429,578 but not over $715,962

    $40,376.66 plus 12.43% of excess over $429,578

    Over $715,962 but not over $1,000,000

    $75,974.19 plus 13.53% of excess over $715,962

    Over $1,000,000 and over

    $114,404.53 plus 14.63% of excess over $1,000,000

  8. Determine the tax credit by applying the following guidelines and subtract this amount from the result in step 7.

    Tax Credit = $119.90 x Number of Regular Allowances Claimed on DE-4 or W-4.

  9. Divide the annual California income tax withholding by 26 to obtain the biweekly California income tax withholding.

Additional Resources

To view the updated tax formula go to the HR and Payroll Clients page from the MyNFC drop-down menu on the NFC homepage. Click the Publications tab in the center ribbon. Select U.S. Income Tax Formulas from the Publication menu to launch the tax map. Click the desired State from the map provided for the formula.

Inquiries

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