2021 Federal Taxes and Nonresident Alien Additional Amounts

The following are the updates for 2021:

• The percentage method tables have been updated.

• The amount added to the wages of a nonresident alien employee, who was first paid wages before 2020 and has not submitted a Form W-4 for 2020 or later, has increased from $8,100 to $8,250.

• The amount added to the wages of a nonresident alien employee, who was first paid wages in 2020 or later or has submitted a Form W-4 for 2020 or later, has increased from $12,400 to $12,550.

For more information, see: https://www.irs.gov/pub/irs-pdf/p15t.pdf.

Illinois 2021 Tax Update

The value of a state withholding allowance in the withholding formula increases from $2,325 to $2,375. 

Kentucky 2021 Tax Update

The standard deduction amount increases from $2,650 to $2,690. For more information, see: https://revenue.ky.gov/Forms/2021 42A003(TCF)(12-2020).pdf.

Michigan 2021 Tax Update

The personal exemption amount increases from $4,750 to $4,900. For more information, see: https://www.michigan.gov/documents/taxes/446_711611_7.pdf.

Minnesota 2021 Tax Update

These are the updates for Minnesota:

• The amount of one withholding allowance increases from $4,300 to $4,350.

• The withholding tables for Single and Married have been updated.

Mississippi 2021 Tax Update

The annual withholding percentage table has been updated. For more information, see: https://www.dor.ms.gov/Documents/Computer Payroll Flowchart 9-9-20.pdf. 

Missouri 2021 Tax Update

The following are the updates for Missouri:

• The standard deduction amounts have increased. These are the new amounts:

• Single: $12,550

• Married and Spouse Works: $12,550

• Married and Spouse Does Not Work: $25,100

• Head of Household: $18,800

• The tax bracket thresholds used in the formula have been adjusted.

For more information, see: https://dor.mo.gov/forms/4282_2021.pdf.

New Jersey Income Tax Withholding (Remainder of 2020)

New legislation enacted September 29, 2020, made several changes to the New Jersey Gross Income Tax Act as part of New Jersey’s Fiscal Year 2021 budget. The new law increases the Gross Income Tax rate for income between $1 million and $5 million and provides a new withholding rate for the remainder of 2020.

Effective January 1, 2020, the tax rate on that income bracket increases from 8.97% to 10.75%, regardless of filing status.

Effective immediately, employers must withhold Income Tax at the rate of 21.3% from salaries, wages, and other remuneration in excess of $1 million, but not in excess of $5 million, during the taxable year.

This higher withholding rate allows taxpayers affected by the rate increase to "catch up" on their withholdings for the year since the new tax rate is retroactive to January 1, 2020.

The Division of Taxation will not impose interest or penalties for insufficient payment of estimated tax and/or withholdings that may be due before September 29, 2020, if the underpayment is a result of the new tax rate.

For more information, see https://www.nj.gov/treasury/taxation/pdf/withholdingtables.pdf.

New Mexico 2021 Tax Update

Updates to New Mexico include the following:

• The percentage method implements a new 5.9% income tax bracket. 

• The supplemental tax rate increases from 4.9% to 5.9%.

New York State 2021 Tax Update

The annual withholding tax tables for Married and Single have been updated. For more information, see: https://www.tax.ny.gov/pdf/publications/withholding/nys50_t_nys_121.pdf.

North Dakota 2021 Tax Update

The tax brackets used in the following have been adjusted:

• Withholding method for Forms W-4 before 2020

• Withholding method for Forms W-4 for 2020 and after

For more information, see: https://www.nd.gov/tax/data/upfiles/media/income-tax-withholding-rates-and-instructions-booklet-2021.pdf.

Oregon 2021 Tax Update

Here are the updates for Oregon for 2021:

• The federal tax adjustment amount increases from $6,950 to $7,050 for an employee with annual wages up to $50,000.

• The federal tax adjustment phase-out amounts for an employee with annual wages of $50,000 or greater have changed.

• The tax table has changed for an employee with annual wages of up to $50,000.

• The tax table has changed for an employee with annual wages of $50,000 or greater.

• The allowance amount increases from $210 to $213.

• The standard deduction amount increases for the following statuses:

• Single with fewer than 3 allowances: from $2,315 to $2,350

• Single with 3 or more allowances: from $4,630 to $4,700

• Married: from $4,630 to $4,700

For more information, see: https://www.oregon.gov/dor/forms/FormsPubs/withholding-tax-formulas_206-436_2021.pdf.

Rhode Island 2021 Tax Update

Updates for Rhode Island include the following:

• The annual withholding table has been updated.

• The threshold for the 0.00 allowance amount increases from $231,500 to $234,750.

For more information, see: http://www.tax.ri.gov/forms/2021/Withholding/2021 Withholding Tax Booklet.pdf. 

Vermont 2021 Tax Update

These are the changes for Vermont:

• The annual percentage method withholding tables for Married and Single have been updated.

• The value of a withholding allowance increases from $4,350 to $4,400.

Defect 1414096: If the state ID was longer than 12 characters, the ID did not show on the 1099 MISC or 1099 NEC forms when you clicked the printer icon from the preview pane, or when you downloaded the preview to a PDF file. However, the state ID did display in the print preview.

Defect 1404085: When you tried to configure the Grouping and Sorting option on the Columns & Groups tab for the following reports, the corresponding grouping options were not available in the Available Grouping list on the Select Groupings dialog box:

• AR Aged: Invoice and Invoice Date

• AR Ledger: Invoice Date

• Invoice Register: Invoice Date

Defect 1405717: When you ran the State Unemployment Insurance Worksheet report by individual state, the Gross Pay Less Exclusions amount on the report was incorrect for employees when both of the following applied:

• The employee had Locale Method set to Follow Project Locale on the Payroll tab in the Employees hub and had a 401K withholding.

• During payroll processing, you overrode the state tax withholding amount.

Defect 1405720: When a payroll contribution code’s method was set up as a fixed amount in Settings » Payroll » Contribution Codes, the wage base limit for the contribution code was not honored when you processed a payroll payment run. Instead, a contribution was deducted from an employee’s payroll payment even when the employee’s year-to-date gross pay exceeded the contribution code’s wage base limit.