Connecticut updates withholding guide; no new tables

The Connecticut Department of Revenue Services has revised its employer’s tax guide to provide guidance for employers who withhold Connecticut personal income tax from their employees’ wages in 2018. Married individuals who are employed and have filed a joint Connecticut personal income tax return are reminded they might have to adjust the amount of income tax withheld from one spouse’s wages in order to avoid the underwithholding or overwithholding that may happen when wages are combined.
The revised guide provides general withholding rules and instructions, answers to frequently asked questions, a calendar of duties, sample remittance forms, and withholding calculation rules and tables for 2018. The tables have not changed. All of the withholding tables are reproduced in the Payroll Management Guide at ¶5573 and ¶5574. (Connecticut Department of Revenue Services, IP 2018(1), Employer’s Tax Guide, Circular CT, (Issued: 12/04/17).)

Pension distributions

Beginning on or after January 1, 2018, payers who maintain an office or transact business in Connecticut and make payments of taxable pensions or annuity distributions to a resident individual are required to deduct and withhold tax from such distributions. This requirement applies to distributions from an employer pension, an annuity, a profit sharing plan, a stock bonus, a deferred compensation plan, an individual retirement arrangement, an endowment or a life insurance contract. In addition, for tax year 2017 and prior, Form CT-W4P, Withholding Certificate for Pension or Annuity Payments, are obsolete and taxpayers must file a new Form CT-W4P with their payer.
Further, the guidance includes income tax worksheets and a blank Form CT-W4, Employee’s Withholding Certificate and Supplemental Withholding Table for Married Couples Filing Jointly. (Connecticut Department of Revenue AN 2017(11), Revised Form CT-W4P for Connecticut Resident Recipients of Pension and Annuity Distributions, (Issued 12/07/17); Form CT-W4P, Withholding Certificate for Pension or Annuity Payments (10/17).)

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