Federal Income Tax Withholding 2023 Updates

The updates for federal income tax withholding are effective January 1, 2023:

• The annual additional amount of a nonresident alien employee, who was first paid wages before 2020 and has not submitted a Form W-4 for 2020 or later, increases from $8,650 to $9,550.

• The annual additional amount of a nonresident alien employee, who has submitted a Form W-4 for 2020 or later or was first paid wages in 2020 or later, increases from $12,950 to $13,850.

For more information, see the Federal Income Tax Withholding Methods: https://www.irs.gov/pub/irs-pdf/p15t.pdf

Colorado 2023 Tax Updates

The updates for Colorado are effective as of January 1, 2023:

• The state income tax rate decreases from 4.55% to 4.4%.

• The standard amount for employees with a federal filing status of married filing jointly or qualifying widow or widower increases from $8,000 to $9,000.

• The standard amount for all other filing statuses increases from $4,000 to $4,500. 

For more information, see the Colorado Withholding Worksheet for Employers: DR 1098 Colorado Income Tax Withholding Worksheet for Employers

Indiana 2023 Tax Updates

Effective January 1, 2023, the state income tax rate for Indiana will be 3.15%, down from 3.23% last year. For more information, see Indiana Department Notice #1: https://www.in.gov/dor/files/dn01.pdf

Maryland 2023 Tax Updates 

The updates for Maryland are effective January 1, 2023:

Standard Deduction and New Tax Rate

• • • The minimum standard deduction increases from $1,600 to $1,700.

    • The maximum standard deduction increases from $2,400 to $2,550.

    • A percentage method corresponding to a 2.75% local tax rate has been added to the guide.

For more information, see the Maryland Employer Withholding Guide: 2023 Withholding Guide (marylandtaxes.gov)

Updated Tax Rates

• • • Anne Arundel County uses a tax rate of 2.81% for taxable income of more than $50,000 and a tax rate of 2.7% for taxable income of up to $50,000.

    • Frederick County uses a 2.75% rate when an employee earns up to $100,000 and has a filing status of married filing jointly, head of household, or qualifying widow/widower with dependent child, or when an employee earns up to $50,000 and has a filing status of single, married filing separately, or dependent. Otherwise, the tax rate of 2.96% applies.

    • Allegany County decreases the tax rate from 3.05% to 3.03%.

    • Cecil County decreases the tax rate from 3% to 2.8%.

    • St. Mary’s County decreases the tax rate from 3.1% to 3%.

    • Washington County decreases the tax rate from 3% to 2.95%.

For more information, see the Maryland Withholding Tax Facts: 2023 Withholding Tax Facts (marylandtaxes.gov)

Mississippi 2023 Tax Updates

Effective January 1, 2023, the flat income tax rate for Mississippi will be 5%. Previously, the withholding formula used two brackets of 4% and 5%. For more information, see the Mississippi Employee’s Withholding Exemption Certificate: https://www.dor.ms.gov/sites/default/files/Business/89350218.pdf

New Mexico 2023 Tax Updates

The updates for New Mexico are effective January 1, 2023:

• The percentage method tax brackets have been adjusted.

• The tax rates continue to range from 1.7% to 5.9%.

• The supplemental tax rate also remains at 5.9%.

For more information, see the New Mexico Withholding Tax: https://www.tax.newmexico.gov/businesses/wp-content/uploads/sites/4/2021/03/FYI-104.pdf

North Carolina 2023 Tax Updates

Effective January 1, 2023, the withholding tax rate for North Carolina decreases from 5.09% to 4.85%. For more information, see the 2023 Income Tax Withholding Tables and Instructions for Employers: https://www.ncdor.gov/media/13802/open

Oregon 2023 Tax Updates

The updates for Oregon are effective January 1, 2023:

• • The federal tax adjustment amount for an employee with annual wages of up to $50,000 increases from $7,250 to $7,800.

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

  • 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 higher.

  • The allowance amount increases from $219 to $236.

  • The standard deduction amount increases for the following statuses:

  • • • Single with fewer than 3 allowances: From $2,420 to $2,605

      • Single with 3 or more allowances: From $4,840 to $5,210

      • Married: From $4,840 to $5,210

For more information, see the Oregon Withholding Tax Formulas: https://www.oregon.gov/dor/forms/FormsPubs/withholding-tax-formulas_206-436_2023.pdf

Rhode Island 2023 Tax Updates

The updates for Rhode Island are effective January 1, 2023:

• Tax rates used in the withholding methods continue to range from 3.75% to 5.99%, while the brackets used in the percentage method have been adjusted.

• The annual wage threshold above which the value of a state allowance is zero increases from $241,850 to $260,550. 

For more information, see the Rhode Island Employer’s Income Tax Withholding Tables: https://tax.ri.gov/sites/g/files/xkgbur541/files/2022-12/2023%20Withholding%20Tax%20Booklet_12162022.pdf

Vermont 2023 Tax Updates

The updates for Vermont are effective January 1, 2023:

• The state allowance increases from $4,500 to $4,850.

• The tax brackets used in the percentage method have been adjusted but continue to range from 0% to 8.75%.

For more information, see the Vermont 2023 Income Tax Withholding Instructions, Tables, and Charts: https://tax.vermont.gov/sites/tax/files/documents/GB-1210-2023.pdf

Defect 181110: This issue applies for users who upgraded to Vantagepoint 5.0.6. When you navigated to Hubs » Firms » Voucher Review, you were not able to sort the records in the Vouchers grid because the sort icon did not display next to the columns.

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Defect 1812383: In List View, when you selected a record to delete, the dialog box that prompted you to confirm the deletion displayed a different record, thus making it possible for you to delete the wrong record.

Defect 1843317: This issue occurred when you created a new project, set the How to Create option to From Project, and on the Choose Project Structure form selected only the top level of the project. In the Projects hub, you incorrectly received a Validate Warning workflow action as an error message rather than a warning message when there were errors in the collection of messages.

Defect 1853084: This issue occurred in the desktop application. When you generated the efile for the electronic filing of the W-2 form, the box 12 values on page 2 of the W-2 form were not included in the efile.

Defect 1835801: This issue occurred when you edited a credit card and added another secondary card for it. If you assigned the new secondary card to an employee who was already assigned to another secondary card for the credit card, and then you deleted the employee from the other secondary credit card, the employee was incorrectly deleted from the new secondary card.