How to Set up State Tax Information

To include State Tax information on Employee records, you will need to configure their state tax settings.

Navigating to State Taxes
  • Expand Setup and click Setup Properties from the menu.

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  • Hover over Employee Portal Setup and click Employee Portal.

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  • Click the Quick Links tab.

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  • Click the Configure State Tax Info link.

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Step 1 - Define the States Where the Employees Work

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In Step 1, you will define the states where the employees work. This includes both Income Filing States and Unemployment States.

Selecting the checkbox next to the appropriate state(s) will allow that state to be available for selection by the employee when creating a State Tax record.

After the appropriate checkboxes are selected, click Save Selected States.

Step 2 – Select Which Income Filing State(s) You Would Like to Configure

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In Step 2, you have the option to configure some of the state tax settings for all their selected states, or individually for each state. The states in the dropdown are populated by the states chosen in Step 1.

In the dropdown menu, if you select "-- All my selected states above --", you will be able to edit their state tax settings to include additional fields, however, the pre-determined default settings for each state cannot be removed.

When the "-- All my selected states above --" option is selected, the additional settings you provide in Step 3 will be applied to all the states you have selected in the income filing states list. Each individual state’s default settings will not be changed, just the additional settings applied will be added/removed based on your choices.

Step 3 – Configure State Tax Settings

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In Step 3, you will have the option to configure some of the state tax settings.

 When Setting Up State Taxes

If the State is being set up for the first time for your account after 1/20/2022, new functionality in Core HR will set default settings based on the specific state tax forms for:

  • Additional Withholdings (Show Additional Withholding field)
  • Filing Status (Show Filing Status field)
  • Allowances (Show Allowances field)
  • Exempt (Show Exempt Option field)

If you have States already configured in their account prior to 1/20/2022, you will not be impacted by the new functionality and would remain as you had previously configured them.

State Tax Settings

  • Custom Instructions - This allows you to enter any custom instructions you would like employees to see when making state tax elections. This text will appear at the top of the screen.
  • Show State Tax Link - If checked, a link will appear to employees that opens a new window to the Department of Labor's site where they can view and download state tax forms.
  • Show Additional Withholding - If checked, a field will be available for employees to enter an amount of additional withholding at the state level. Some states do not allow for additional withholding.
    • If this is a new state being added to your account for the first time after 1/20/2022, this option may be pre-selected as a default setting based on the specific state tax form. If this is the case, you will not be able to remove this setting.
  • Show Filing Status - If checked, a selection list will be available to the employee to select a state tax filing status. This feature is turned on by default. If you are configuring a state that does not require state tax, uncheck this box.
    • If this is a new state being added to your account for the first time after 1/20/2022, this option may be pre-selected as a default setting based on the specific state tax form. If this is the case, you will not be able to remove this setting.
  • Show Allowances - If checked, a field will be available for employees to enter a number of allowances for state tax. Some states do not allow for allowances.
    • If this is a new state being added to your account for the first time after 1/20/2022, this option may be pre-selected as a default setting based on the specific state tax form. If this is the case, you will not be able to remove this setting.
  • Show Open Percentage - If checked, a field will be available for employees to enter a percentage for state tax withholding.
  • Show Exempt Option - If checked, a checkbox will be available to the employee to select exemption from state tax.
    • If this is a new state being added to your account for the first time after 1/20/2022, this option may be pre-selected as a default setting based on the specific state tax form. If this is the case, you will not be able to remove this setting.
  • Show Percentage Withholdings - If checked, a list of predefined percentages will become available for selection.
    • Percentage Withholding Options - Some states allow for only predefined percentage elections towards state tax withholding.
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      • To add a percentage:
        1. Enter a number on the left-hand side in the given field.
        2. Click the + button to add the predefined percentage.
      • To remove a percentage:
        1. Select a predefined percentage on the right-hand side.
        2. Click the - button to remove the predefined percentage.
  • Show Overrides - When enabled, two additional fields for override amount and override percentage are shown.

Once the State Tax settings are configured, click Save Settings.

Repeat Steps 2 and 3 for each individual state that should have settings configured.

The Employee Experience

Navigating to State Tax Info Setup for Employees
  • In the employee portal, go to Information from the menu.

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  • Click State Tax Info in the My Preferences section.

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  • Click Create State Tax Record from the Actions drop-down menu.

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The page for an employee to create a state tax record can differ depending on the state tax settings. The employee will first select the state from the income tax filing state drop-down menu for the options to appear.

The options enabled in State Tax Settings will present like below in the labeled spots. If an option is missing, refer to the list for what should be enabled under State Tax Settings.

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  1. Custom Instructions
  2. Filing Status
  3. Allowances
  4. Additional Withholding
  5. Percentage Withholdings
  6. Open Percentage
  7. State Tax Link
  8. Exempt Option
  9. Overrides

Rates

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The rates tab allows you to set up the unemployment rate and/or the unemployment rate cap for a state.

Adding a Detail Record

  • To add a rate detail record, click Add Detail Record.

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  • Select the State, Tax Year, and indicate the State Unemployment Rate and/or State Unemployment Rate Cap.

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  • Click Save Rates when finished.

Deleting a Detail Record

To delete a detail record, use the checkbox to the left of an appropriate record and click Delete Selected Records.

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