Change in Federal Withholding Tables
President Obama recently signed into law the American Recovery and Reinvestment Act of 2009. By implementing this new act, many employees will automatically see a reduction in their federal income tax withholding. You do not have to submit a Form W-4 (Employee’s Withholding Allowance Certificate) to get the automatic withholding change. Pace University has made the appropriate tax table updates and many employees will begin to see the change in their net pay for the March 31st 2009 pay period.
For some employees, this change could inadvertently cause under-withholding of federal taxes. Employees with multiple jobs and dual wage households should review IRS guidance to determine whether they are withholding appropriately given the new tax law change. IRS Publication 15T provides this guidance. This publication can be found at the IRS website:
www.irs.gov/app/picklist/list/publicationsNoticesPdf.htm. If you are concerned that this change to the tax tables will result in an under-withholding of your federal income taxes, you may want to update your W-4 Form via the Pace Self Service Website, under the Staff Tab. Please remember, a decrease in the number of exemptions you claim will increase your federal income tax withholdings.