TAXES 18-37, North Carolina State Income Tax Withholding
Published: March 21, 2018
Effective: Pay Period 06, 2017
Summary
This tax bulletin is being updated to remove the number of pay periods in steps 4 and 8 and replace with the phrase "number of pay dates in the tax year," thereby preventing any confusion in future years. All other information in this bulletin remains the same.
No action on the part of the employee or the personnel office is necessary.
Tax Formula
State Abbreviation: |
NC |
State Tax Withholding State Code: |
37 |
Acceptable Exemption Form: |
NC-4 |
Basis for Withholding: |
State Exemptions |
Acceptable Exemption Data: |
S/M/H, Number of Allowances |
TSP Deferred: |
Yes |
Special Coding: |
None |
Additional Information: |
North Carolina has implemented a new withholding exemption claim form. The State of North Carolina has indicated that all employees must file a new Form NC-4 EZ or NC-4 for tax year 2017. |
Withholding Formula (Effective Pay Period 06, 2017)
- Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
- 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.
- 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.
- Multiply the adjusted gross biweekly wages by the number of pay dates in the tax year to obtain the gross annual wages.
- Determine the standard deduction allowance by applying the following guideline and subtract this amount from the annual wages:
If the Employee Is:
The Standard Deduction Is:
Nonresident Alien, Regardless of Marital Status
$0
Single
$8,750
Married or Qualifying Widow(er)
$8,750
Head of Household
$14,000
- Determine the exemption allowance by subtracting the amount from the gross annual wages to compute the taxable income.
Exemption Allowance = $2,500
- Multiply the annualized taxable wages calculated in step 6 by 5.599 percent to determine the annual tax amount.
- Divide the annual North Carolina tax withholding calculated in step 7 by the number of pay dates in the tax year and round to the nearest dollar to obtain the biweekly North Carolina tax withholding.
- If the employee is a nonresident alien (NRA), and is claiming additional withholding, subtract the applicable amount shown in the table below from the additional withholding (but not less than zero).
Pay Frequency
Additional Withholding
Weekly
$9
Biweekly
$19
Semimonthly
$20
Monthly
$41
Any other pay frequency
$489.91 / # of annual pay periods, rounded up to the next whole dollar
- Add the additional amount (reduced by NRA additional amount from previous step) or percentage elected by the employee to the pay period tax calculated in the above step and round to the nearest dollar to determine the amount of tax to be withheld for this pay period.
Resources
To view the updated tax formula, go to the
page from the drop-down menu on the National Finance Center (NFC) homepage. Select the tab and select from the menu to launch the tax map. Select the desired State from the map provided for the formula.Inquiries
For questions about NFC processing, authorized Servicing Personnel Office representatives should contact the NFC Contact Center at
or via the customer service portal.