Tax Withholding Information
Change your withholding elections (IRS Form W-4) in Workday.
Your tax residency address on the tax forms will pull from your Home (Primary) Address in Workday.
Federal Withholding Tax
Overview
Most payments to employees have Federal Withholding Tax deducted based on the IRS Semi-Monthly Tax Withholding Table, your IRS Form W-4 Withholding Allowance Certificate, and any pre-tax deductions you have elected.
Payments made separately from salary payments are exceptions to the withholding tax guidelines, as follows:
- Supplemental Wage payments (e.g., Awards, Employee Separation Authorization Payments—vacation time paid at separation from the UW—as well as some other payments) have a Federal Withholding Tax rate of 22%.
- Taxable Fringe Benefits (e.g., gift certificates, moving expenses, sports tickets, non-job related graduate student tuition over the IRS Section 127 exemption limit, as well as some other payments) have a Federal Withholding Tax rate of 22%.
- Employee benefits such as health care and retirement are pre-tax reductions and are not included as part of your taxable income.
- Stipend Payments
- Scholarship and fellowship payments are not considered wages, and are not reported on Form W-2. Such payments are reported at year end on IRS Form 1098-T.
- Scholarship and fellowship payments may be paid to individuals who are not students at the University of Washington. At year end, information on such payments are summarized in a letter from the ISC.
- For additional information on scholarship and fellowship payments, see IRS Publication 970 Tax Benefits for Education (PDF).
- The UW does not withhold federal tax for stipends, scholarships, or fellowships. Withholding information on the Form W-4 does not apply to such payments.
University of Washington employees cannot provide personal, legal, or tax advice.
Withholding Elections (IRS Form W-4)
New Employees – Set your initial withholding elections:
Your IRS Form W-4 must be completed in Workday so that the UW can withhold the correct federal income tax from your pay. Refer to the Add Federal Withholding Elections User Guide for details.
Update your current withholding elections:
Changes to your IRS Form W-4 in Workday can be made at any time throughout the year. Refer to the Update Federal Withholding Elections User Guide for details.
Abbreviated versions of the procedure to update your withholding elections have been translated into a number of languages, and are available for download on the Quick Guides – Translations page.
Foreign Nationals:
Foreign National employees have special rules for filling out IRS Form W-4.
Considerations
- Exempt status on the IRS Form W-4 is valid for one year. If you are eligible to claim Exempt, your W-4 must be renewed each year by February. If your W-4 information is not renewed or updated on time, by IRS law your tax status automatically defaults to the Single tax tables and zero allowances.
- The University of Washington will not refund federal withholding taxes due to either late or incomplete IRS Form W-4 information.
Additional Withholding Forms Requirements
If you are receiving a pension from the University of Washington, you will need to complete an IRS Form W-4P Withholding Certificate for Pension or Annuity Payments. This must be done on paper and submitted to the ISC.
If you are receiving a supplemental pension from the University of Washington, you will need to fill out IRS Form W-4P Withholding Certificate for Pension or Annuity Payments. If you have questions about your supplemental pension, contact the ISC.
OASDI (Social Security & Medicare)
OASDI (Social Security and Medicare) are mandatory federal payroll taxes. Federal Insurance Contributions Act (FICA) is the combined employee and employer portions of mandatory OASDI (Social Security and Medicare) taxes.
Social Security is withheld on taxable gross income up to an annual wage limit each year.
Medicare is withheld on taxable gross income. The rate is increased when the minimum subject gross threshold is crossed.
Exceptions to OASDI (Social Security and Medicare) taxation include:
- IRS Student FICA exemption
- You must be:
- a) In a student job class, and
- b) attending school full time, and
- c) working for an educational institution.
- You must be:
Information on the Student FICA exemption
- Scholarship and Fellowship Stipends
- Scholarship and fellowship earnings are not subject to OASDI (Social Security and Medicare) taxation.
Information on the Scholarship and Fellowship Stipends exemption
- Foreign National employees may be exempt under certain circumstances.
Information on Foreign Nationals exemptions
Paid Family and Medical Leave
Refer to the WA Employment Security Department website for information.
WA Medical Aid/Worker’s Comp
Information on Washington State Medical Aid and Worker’s Compensation
Working Outside WA State
State Income Tax
Washington is one of seven states in the US that do not have a state income tax. Employees working and residing in Washington have no state income tax liability. However, if you are working in a state that does have an income tax, the UW is required to withhold income tax for the state(s) in which your services are performed.
You are responsible for verifying that your Home (Primary) Address in Workday is accurate and properly reflects your tax residency address so your taxes will be withheld correctly.
You may be required to fill out additional state withholding tax forms in Workday – refer to the State and Local Withholding Elections User Guide.
If you have questions, contact the ISC and include “Payroll Tax Inquiry” in the Subject.
US Citizens Working Abroad
Generally, Federal Withholding and OASDI (Social Security and Medicare) taxes must be withheld from wages earned outside the US.
Federal withholding tax is not withheld if it is reasonable to believe that your wages would be excluded under the Foreign Earned Income exclusions.
Information on taxes for US Citizens and Resident Aliens Abroad
If this exception applies to you, complete IRS Form 673 Statement for Claiming Exemption from Withholding on Foreign Earned Income Eligible for the Exclusion(s) Provided by Section 911. This form must be submitted to the ISC.
IRS Form 673 form applies to US citizens only. It does not apply to Foreign Nationals.
