AVOID OR CORRECT INTERIM OVER-WITHHOLDING
• The Connecticut Department of Revenue Services (DRS) is aware that many employees are continuing to experience significant employer over-withholding of state income tax due to bonuses, overtime, other extraordinary compensation as well as income earned in another state and by seasonal employees.
• Beginning this May, the Department has taken extraordinary steps to inform employers, payroll companies and the public on ways to avoid over-withholding during interim implementation of the state income changes from August through December, 2011.
• Some employers and payroll providers have experienced no problems, but many others have so, unfortunately, it appears that the message just isn’t getting through.
• In a further effort to help remedy this situation, DRS is again providing guidance for employers and payroll companies while asking employers to share this information with employees: DRS Announcement 2011(6), Additional Guidance Regarding Withholding Calculation Rules for Supplemental Compensation and Use of Newly Issued Form CT-W4T
• Employers are also reminded that state law allows employers simply to correct the over-withholding by returning the money to their affected employees as some employers have already done.
• Visit the DRS website at www.ct.gov/DRS to view Announcement 2011(6) and the attached Form CT-W4T, or to find other tax information and to file and pay Connecticut taxes online.
• For telephone assistance, call the DRS Taxpayer Services Division at (800) 382-9463 (Connecticut calls outside the Greater Hartford area) or (860) 297-5962 (from anywhere).