How do I calculate the SITW when doing Payroll?

Please make sure that the following is setup:

Go to Payer>Payer Edit>Preferencesand make sure that Preference #3, under “Check Entry Fields”has a check in the box.

Go to Payer>Payer Edit>State/Localand select the W/H Method.

Next highlight the Employee and click Edit>Live Payroll Parameters and setup the employee’s State information. When you click on AddChk make sure there is a a check next toSITW (or place a -1.00 in the field).

 

Common State Income Tax Withholding Errors

SITW tax is among the most important calculations an employer will make when addressing payroll. Here are a few of the most common errors you can make, as well as how to avoid them.

  • Miscalculations – Year after year, bad math is responsible for the majority of state income tax withholding errors. The only way to avoid this is to have a computer do most of the calculations for you. For that, we recommend AMS Payroll. If you prefer to do your calculations manually, double- and triple-check your math.
  • Misclassification – 1099 workers handle their own employment taxes, while W-2 workers have their state income tax withheld from paychecks by the employer. Not sure which type you employ? Check out our guide.
  • Old W-4 Forms – When the Tax Cuts and Jobs act passed in December 2017, the IRS updated several income tax withholding tables and encouraged filers to review and update their W-4 forms. A 2018 survey suggest that most Americans didn’t do that, which means tax classifications may have changed without your knowledge. Double-check with your employees regarding all W-4 forms.

 

Software Solutions from AMS

Our W-2 and 1099 Forms Filer is our only required platform. From there, users pick the services they need. Choose from the tools below to build out your customized accounting software.