Employee Matters

This column is prepared by staff from the Office of Human Resources. E-mail questions to benefits@ohr.wisc.edu or call 262-5650. For more information, visit Payroll and Benefits Services.

Each year, many employees are asked to complete new tax forms for various tax statuses, including the Advanced Earned Income Credit, Tax Reciprocity agreements, and employees qualifying for the Federal or Wisconsin Income Tax exempt status. Employees who had a form on file during 2008 were sent a renewal notification during the last quarter of 2008.

Employees must resubmit these forms prior to the expiration date to keep their status intact. As most of these notifications are sent through e-mail, it is important to keep your address up-to-date in the payroll system.

See your payroll coordinator to verify or update your e-mail information.

Advanced Earned Income Credit

This is an amount given to employees who qualify for the EIC and elect to receive it before their tax filing period by having it added to their paychecks.

According to the IRS: “To receive part of the credit with your pay, you must expect to have at least one qualifying child for the current year, expect to fall within certain income limits, and expect to meet certain other conditions. You cannot get the Advanced EIC if you do not expect to have a qualifying child, even if you expect to be eligible to claim the EIC on your current year tax return. To see if you qualify, obtain the current year Form W-5, Earned Income Credit Advance Payment Certificate.”

These forms (W-5) expire at the end of each calendar year and can be found at the Internal Revenue Service.

State Tax Reciprocity Agreements

Wisconsin has reciprocity agreements with the following States: Minnesota, Michigan, Illinois, Indiana and Kentucky.

Residents of Minnesota, working in Wisconsin, who wish to invoke the reciprocity agreement must complete Wisconsin form W-222. This form expires at the end of January each year. Employees who do not refile by Friday, Jan. 29, will have Wisconsin income tax withheld with zero allowances.

Federal Income Tax Exempt Status

According to the IRS, U.S. citizens and resident alien employees claiming exempt from income tax (does not apply to Social Security or Medicare) must comply with the following statement: You can claim exemption from withholding for 2009 only if both of the following situations apply.

• For 2008 you had a right to a refund of all federal income tax withheld because you had no tax liability.
• For 2009 you expect a refund of all federal income tax withheld because you expect to have no tax liability.

This exemption is claimed on a W-4 form. It is valid until Sunday, Feb. 15, and must be reclaimed every year. Employees who do not complete a new W-4 by Thursday, Feb. 12, will have income tax withheld using zero allowances.

Filing any of these forms is the responsibility of the person submitting the forms. The university does not make a determination if the employee qualifies for any associated benefits.

What if I want more information?

Visit Payroll and Benefit Services: Taxes or e-mail payroll@ohr.wisc.edu.