Purpose
To inform agencies of the tax related withholding requirements for 2012.
Affected Employees
Employees receiving paychecks in 2012
Effective Date(s)
January 1, 2012
Social Security
The Social Security wage base limit is increased to $110,100 for 2012.
The Temporary Payroll Tax Cut Continuation Act of 2011 temporarily extends the current employee social security tax withholding rate of 4.2% through February 29, 2012.
An additional bulletin will be issued in late February in the event the employee social security tax withholding rate is changed from 4.2% after February 29, 2012.
Note: Per the IRS, this reduced Social Security withholding rate has no effect on employees’ future Social Security benefits.
The employer social security tax withholding rate is 6.2% for 2012.
Medicare
There is no wage base limit for Medicare tax.
The Medicare tax withholding rate is 1.45% each for the employee and the employer.
Federal Withholding Allowance
The value of one Annual Federal Withholding Allowance is increased to $3,800.
Federal Withholding Rates
The Federal income tax withholding rates have changed for 2012. The new withholding rates can be located in IRS Publication 15, (Circular E), Employer’s Tax Guide.
To access this publication, visit the Internal Revenue Service website at www.irs.gov and select Forms and Publications>View online: Tax Publications>Publication 15.
New York State, New York City and Yonkers Withholding Allowance
The value of one New York State, New York City and Yonkers Withholding Allowance remains at $1,000.
New York State, New York City and Yonkers Withholding Rates
The New York State, New York City and Yonkers withholding tax tables have been revised for 2012.
Please refer to the following publications accessible at the NYS Department of Taxation and Finance website at www.tax.ny.gov for additional information.
| NYS-50-T-NYS | New York State Withholding Tax Tables and Methods |
| NYS-50-T-NYC | New York City Withholding Tax Tables and Methods |
| NYS-50-T-Y | Yonkers Withholding Tax Tables and Methods |
OSC Actions
OSC will update PayServ with these tax related updates for 2012.
Agency Actions
Informational only.
Questions
Questions regarding this bulletin may be e-mailed to the Tax and Compliance mailbox.