New Jersey issues new withholding tables

New Jersey has issued new percentage method withholding tables in response to a recently enacted income tax increase. After January 1, 2018, the personal income tax rate on income over $5 million will be $431,457.50 plus 10.75% for married individuals filing a joint return and individuals filing as head of household or as surviving spouse and $433,373.75 plus 10.75% for married individuals filing separately, unmarried individuals other than individuals filing as head of household or as a surviving spouse. However, the highest withholding rate percentage will be 15.6%. The wage-bracket withholding tables have not been changed. The tables must be implemented no later than September 1, 2018. The state also revised Form NJ-W4, Employee’s Withholding Allowance Certificate. All of the withholding tables are reproduced in the Payroll Management Guide at ¶7316 and ¶7317 (Ch. 45 (A.B. 3088), Laws 2018, approved and effective July 1, 2018; NJ-WT, New Jersey Income Tax Withholding Instructions, July 2018; https://www.state.nj.us/treasury/taxation/prntempl.shtml.)

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