Tax Information

Income Tax Withholding

Employee Withholding Allowance Certificates:

The employees' withholding allowance certificates are the W-4 and the IT-2104. The federal withholding allowance certificate is form W-4 and is filed with the Internal Revenue Service (IRS). The state and the city withholding allowance certificate is the form IT-2104 and is filed with the New York State (NYS) Department of Taxation and Finance. The marital status and number of allowances you claim on these certificates determines the amount of income taxes that are withheld from your wages. Click here to update your tax withholdings.

Every employee is required to complete a federal Withholding Allowance Certificate (W-4), which can also be utilized for state and local withholdings. Most employees complete this form at initial hire.

However, you must file new forms whenever your income tax situation changes; for instance:
  • When your marital status or number of dependents change
  • When you owe income tax or receive a large refund when you file your personal income tax return
  • If you have another job or investment that causes your total income for the year to be significantly higher or lower
  • When your itemized deductions change
The IRS and NYS recommend that you review your withholding allowance every year because changes in tax law may affect your income tax even if other factors remain constant.

If you wish to claim a different number of allowances or marital status for New York State and City income tax withholding than what you have claimed on your federal form W-4, Click here to complete and submit the New York State IT-2104 online through Employee Self Service.
 
Your withholding allowance certificates and any supporting documentation that you may provide are kept in your personnel file in your facility’s Human Resources Department. If more than 14 state exemptions are claimed, your form(s) W-4 and/or IT-2104 will be sent to the New York State Department of Taxation and Finance as required by that authority.

The IRS expects NYC Health + Hospitals to ensure each employee acts responsibly with regard to having their income taxes accurately withheld. If you submit an invalid withholding form, it will not be honored, and you will be advised to submit a valid form. If you do not submit a valid form, NYC Health + Hospitals  will withhold income taxes on the basis of the last valid withholding allowance form submitted by you. If no valid withholding certificate is on file, income taxes will be withheld on the basis of a tax status of single, with zero allowances.

Invalid certificates include:
  • forms with unauthorized changes or additions
  • forms that are incomplete or unsigned
  • forms your facility considers to be false, fraudulent or frivolous.
Copies of forms in these categories will be submitted to Corporate Payroll Services, which will forward the forms to the IRS and/or New York State Department of Taxation and Finance for a determination of whether the form should be honored. The facility will also forward copies of the forms to NYC Health + Hospitals' Office of the Inspector General for an appropriate course of action.
 
forms filed as a tax protester. NYC Health + Hospitals  does not condone the filing of tax protester withholding certificates. Copies of forms and related documentation in this category will be submitted to Corporate Payroll Services, which will forward the forms to the IRS and/or New York State Department of Taxation and Finance for a determination as to whether the form should be honored. The facility will also forward copies of the forms and documentation to NYC Health + Hospitals' Office of the Inspector General for an appropriate course of action.
Withholding Allowances:
Ideally, your total annual withholdings should match your actual income tax liability. If not enough income tax is withheld, you will owe income tax at the end of the year and may have to pay interest and a penalty. If too much income tax is withheld, you will lose the use of that money until you receive your refund.
You can increase your withholding by
  • Decreasing the number of allowances you claim on form W-4, line 5, or
  • Entering a specific additional dollar amount you want withheld from each paycheck on form W-4, line 6. This amount is in addition to what is calculated and withheld based on your marital status and the number of allowances you have claimed on form W-4, line 5.
To decrease your withholding, you can
  • Increase the number of allowances you claim on form W-4, line 5, and
  • Make sure no additional dollar amount is claimed on form W-4, line 6.
The IRS provides detailed instructions and worksheets for determining the appropriate number of withholding allowances. Refer to Publication 919 - How do I adjust my tax withholding or the Withholding Calculator for more guidance.
 
There may be several valid reasons for changing your withholding allowances and you may change your withholding allowances as often as justified by your circumstances. For each change, you must complete and submit a form W-4. Any change you make on your form W-4 will result in the same change in your state and city withholding unless you complete and submit a newform IT-2104 claiming a different income tax status. If you submit four or more changes within a calendar year, your facility will note your frequent filer status in a log maintained for this purpose - as required under HHC Operating Procedure 40-56, Income Tax Withholding Certificate Procedures.

Frequent changes in allowances - especially those requested in anticipation of large or special payments such as Back Pay and Uniform Allowance - may result in under withholding of your income tax obligation. Under withholding may result in year end income tax liabilities and/or penalties to you.
 
Resident aliens* of the United States are subject to the same withholding regulations and are taxed in the same manner as United States citizens. Consequently, form W-4 is completed by resident aliens in the same manner as US citizens.

However non-resident aliens, in order to avoid under withholding of income taxes, are subject to certain restrictions when completing a form W-4. Non-resident aliens
  • cannot claim exemption from income tax withholding
  • must request “single” withholding, regardless of their actual marital status
  • cannot claim more than one exemption allowance **
  • must write “Non-Resident Alien” or “NRA” above the dotted line on line 6 of the form W-4.
* A resident alien is any individual who is not a U.S. citizen or U.S. national. You are a lawful resident alien, if the U.S. Citizenship and Immigration Service (USCIS) issued you an alien registration card (Form I-551 or "green card”). You will also be considered a U.S. resident for tax purposes if you meet the substantial presence test for the calendar year. To meet this test, you must be physically present in the United States on at least:
  • 31 days during the current year, and
  • 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
    – All the days you were present in the current year, and
    – 1/3 of the days you were present in the first year before the current year, and
    – 1/6 of the days you were present in the second year before the current year.
** Non-resident aliens of Canada, Mexico and Korea may claim more than one allowance.


Claiming More than 10 Federal & 14 State Allowances:
You may file withholding certificates with as many allowances as are justified by your circumstances. If you claim more than 10 withholding allowances on your form W-4 or more than 14 allowances on your form IT-2104, you must complete a signed, notarized and unaltered Withholding Certificate Affirmation.

In addition to the Withholding Certificate Affirmation you may, if you wish, supply supporting documentation such as:
• The prior year's income tax returns
• Proof of qualifying home mortgage interest
• Charitable contributions
• State and local income taxes (but not sales tax)
• Medical expenses as stipulated in IRS guidelines
• Number of dependents
• Other qualifying miscellaneous deductions
• A letter from you to the facility’s Human Resources Director stating your circumstances
Copies of the unaltered withholding certificate and unaltered affirmation (signed and notarized) along with copies of any supporting documentation you choose to provide, will be sent to Corporate Payroll Operations.

Corporate Payroll Operations forwards the documents to the IRS or NYS Department of Taxation and Finance as appropriate. In some cases, the IRS or NYS may instruct NYC Health + Hospitals  to change your number of withholding allowances or marital status through Lock-in-Letters.

The IRS or NYS may instruct NYC Health + Hospitals to implement a prescribed number of withholding allowances or a particular marital status for you via a Lock-in Letter. Corporate Payroll Operations will advise your facility’s Human Resources Department to change your allowances or marital status. The original letter from IRS or NYS will be sent to your facility’s Human Resources Department, who will in turn, give a copy to you. Your exemptions or marital status are then "locked-in" until further changes are received from the IRS or NYS.

Subsequent changes initiated by you will be made only if you submit new form(s) W-4/IT-2104 where you are not claiming withholding exempt status or where the number of allowances is equal to or fewer than the number in the Lock-in Letter.

If you receive a Lock-in Letter and believe that your circumstances justify additional allowances or full withholding exemption, you should contact the IRS or NYS directly.
 
Witholding Exemptions:
Exemptions From Federal Withholding
The majority of NYC Health + Hospital employees are required to have income taxes withheld. No employees, including students, are automatically exempt from income tax liability.

You CAN NOT claim exemption from federal withholding income taxes for the current year if:
  • your income exceeds $1,000 and includes more than $350 of unearned income (interest and dividends), and
  • another person can claim you as a dependent on his/her tax return

However, there are some circumstances, which may entitle you to be fully income tax exempt. In order to be exempt from federal withholding taxes, you must verify on the form W-4 that you meet BOTH of the following conditions:

  • Last year you had a right to a refund of ALL federal income tax withholding because you had no tax liability AND
  • This year you expect a refund of ALL federal income tax withheld because you expect to have no tax liability

Exemptions From N.Y. State & City Withholding
In order to claim exemption from New York State and City withholding income taxes you must meet ALL of the following conditions:

  • You are
    • under age 18 OR
    • are a full time student under age 25 OR
    • are over age 65
  • You had no New York income tax liability for the previous calendar year
  • You do not expect to have a New York income tax liability for the current calendar year
If you meet the criteria listed above for exemption, you can claim exemption from New York State and City withholding by completing form IT-2104E, Certificate of Exemption from Withholding and submitting it to your facility’s Human Resources Department. Please note: you cannot claim exemption from New York State and City withholding by completing IT-2104, New York State Employee’s Withholding Allowance Certificate.

Please note: Generally, as a New York State resident, you are required to file a New York State income tax return if you are required to file a federal income tax return, or if your adjusted federal gross income plus your New York State additions (i.e. 414(h) pension contributions, IRC 125 health deductions, etc.) are more than $4,000. However, if you are single and can be claimed as a dependent on another person’s federal return, you must file a New York State income tax return if your adjusted federal gross income plus your New York State additions (i.e. 414(h) pension contributions, IRC 125 health deductions, etc.) is more than $3,000.
 
Expiration of Certificates Claiming Exemption
Both forms W-4 and IT-2104E claim exemption from withholding and expire each year.
If you continue to meet the exemption criteria set forth above, you must submit new form(s)W-4 and/or IT-2104E annually in order to continue your income tax exempt status:
  • File a new form W-4 by February 16th to continue to claim exemption from federal withholding AND/OR
  • File a new form IT-2104E by April 30th to continue to claim exemption from New York State and City withholding
If you do not submit new form(s) W-4 and/or IT-2104E to your facility’sHuman Resources Department by the February 16th or April 30th deadline, income taxes will be withheld from subsequent payroll checks as if you were single with zero allowances until such time as you submit a new withholding allowance certificate (form(s) W-4 or IT-2104 / IT-2104E).
 
Social Security Withholding (FICA) 
Most employees and employers each pay up to 7.65% of payroll covered wages for social security (6.2%) and Medicare (1.45%) taxes. Together these taxes comprise FICA (Federal Insurance Contributions Act). If you earned the maximum or above, you do not pay any more social security tax until the next calendar year. The Medicare tax is 1.45%. There is no cap on payroll covered wages for the Medicare portion of FICA.

The maximum wage base for social security is adjusted each year and is shown below for the past five years:
 
Maximum Social Security Wage Base
Year
Annual Wage Base
Employee Tax Rate
Maximum SS Tax Withholding
​2018 ​$128,700 ​6.2% $​7,979.40
2017
$127,200
6.2%
$7,886.40 
2016
$118,500
6.2%
$7,347.60 
2015
$118,500
6.2%
$7,347.60 
2014
$117,000
6.2%
$7,254.00
2013
$113,700
6.2%
$7,049.40
2012
$110,100
4.2%
$4,624.20
2011
$106,800
4.2%
$4,485.60 


In most cases, employees in the United States pay social security and Medicare taxes. Your employer deducts these taxes from each wage payment. NYC Health + Hospitals  must deduct these taxes even if you do not expect to qualify for social security or Medicare benefits. Employees and employers each pay 7.65% of payroll covered wages for social security and Medicare taxes. Together these taxes comprise FICA (Federal Insurance Contributions Act) withholdings.

Employees with J1 and F1 visas, and Group 12 employees in competitive titles who are US Citizens, may be eligible for exemption from mandatory social security taxes if they meet specific criteria. If you fall into one of these groups and want to know if you qualify, contact the Human Resources of your facility to see if you are eligible.

W-2 Wage and Tax

Domestic Partner Health Benefits
Tax implications of adding a domestic partner to your health plan: The cost of the premium for the health benefits provided to your domestic partner is additional income to you and is subject to Federal, State, Local, Social Security and Medicare taxes. The additional income, attributable to the adding of a domestic partner, is comprised of three parts which will be added to your NYC Health + Hospitals Wage and Tax Statement for each full or partial calendar year in which you have a domestic partner on your health plan:  

(1) The value of basic health benefits paid by NYC Health + Hospitals  for coverage of your domestic partner. This is the value of the employer premiums paid by NYC Health + Hospitals for individual coverage under the employee's designated health plan.

(2) The additional amount of the employee health deduction taken from your payroll checks (individual verses family health deductions) for coverage for your domestic partner. The portion of the employee health deduction added for coverage of your domestic partner is not an eligible IRC 125 deduction.

(3) The value of health insurance benefits provided to your domestic partner by your Welfare Fund. This amount is calculated directly by the respective Welfare Fund. The Welfare Fund reports this amount to NYC Health + Hospitals for inclusion in your NYC Health + Hospitals  W-2.
Note: NYC Health + Hospitals  is required to withhold any Social Security tax to which these benefits may be subject. NYC Health + Hospitals  will advance these taxes to the IRS on your behalf and add this additional Social Security and/or Medicare tax to boxes 4 and 6 of your NYC Health + Hospitals  W-2, respectively. NYC Health + Hospitals will recoup any FICA and/or Medicare tax advanced via "tax payback" deductions from your payroll checks beginning in February of the subsequent calendar.