Maryland Employer Withholding Tax Change

The Comptroller of Maryland, Revenue Administration Division reported in an
Employer Withholding Tax Alert (06-08) that due to an amendment to the Tax Reform Act of 2007 major changes go into effect July 1, 2008, in the income tax law that affects employer withholding for tax years beginning after December 31, 2007. This change adds a 6.25 percent income tax bracket for Maryland taxable income in excess of $1 million.  More information can also be found on the topic in the latest edition of Revenews, Summer 2008, Senate Bill 46 (Chapter 10, Acts of 2008) – Budget Financing Act. In conjunction with these changes, the Employer Withholding Tax Percentage Method Tables have been updated as well.  The updated 2008 Percentage Method Tables can be found on the Agency’s website, click here. As noted on the website, click on the
jurisdiction where the employee lives to find the proper calculation.

Frequently Asked Questions

How do I know if I'm affected?
 
You may be affected if you currently withhold Maryland income taxes from employee’s wages or have a valid Maryland Registration Number.

When will these changes be available in QuickPayroll?

QuickPayroll will modify the Maryland withholding tax tables in Payroll Update #20812 to be released on July 31, 2008.

What steps do I need to take next?

You will need to download and install Payroll Update #20812 as soon as it is released. For more information on how to download and install a Payroll Update, click on the Help menu, select User’s Guide from the drop down list, click on the Index tab, and then type “Updating” in first field.  Help is provided for both downloading and installing Payroll Updates.

Links:

Employer Withholding Tax Alert (06-08)
2008 Percentage Method Tables
Revenews 2008 Summer

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