DRS: Important Connecticut Withholding Tax Information for Employers

Important Connecticut Withholding Tax Information
for Employers

Recently enacted legislation may require catch-up withholding for certain individuals:

  • Single Filers with Annual Earnings More Than $500,000
  • Head of Household Filers with Annual Earnings More Than $800,000, or
  • Joint Filers with Annual Earnings More Than $1 Million.
 
Please see below to determine whether any of your employees’ withholding needs to be adjusted.
 

Effective for taxable year 2009, the highest marginal tax rate has increased to 6.5% for the following individuals:

  • Individuals whose Connecticut filing status is “Single” or “Separately” and whose Connecticut taxable income is more than $500,000.
  • Individuals whose Connecticut filing status is “Head of Household” and whose Connecticut taxable income is more than $800,000
  • Individuals whose Connecticut filing status is “Jointly” or “Qualifying Widow(er)” and whose Connecticut taxable income is more than $1 million.

Employers are required to adjust the withholding amount for employees within these tax brackets to reflect the 6.5% rate. To determine the catch-up withholding for employees that are subject to the new rate, calculate the tax due on the annualized taxable income, subtract the withholding tax already withheld, and divide the difference by the number of pay periods remaining in 2009.

To calculate the additional withholding tax for taxable year 2009 click here.    

For Table A Exemptions and Table B Personal Tax Credits click here.
 
NOTE:   The annual increase to the personal exemption and credits used in calculating the tax for single income tax filers has been delayed by three years. The personal exemptions and credits for the 2008 taxable year remain in effect for the 2009 taxable year. The scheduled increases will resume beginning with the 2012 taxable year.
 

Content Last Modified on 11/20/2009 3:43:57 PM