You may adjust your withholding anytime during the year & as often as you need to.

• The withholding certificate (form UC-W4) is available from LHRD, and must be filed at the campus Payroll Office by at least one week before payday.  Paper W4s are processed on a rolling basis---the timing and accuracy isn't always perfect.

 
• Now you may update your W4 (and your home mailing address) overnight, online instead. Go to the bencom website:   www.ucop.edu/bencom 

Warning!  If you're making a part-year withholding adjustment---plus or minus---don't forget to mark your calendar with a reminder to "READJUST WITHHOLDING" for the next tax year, anytime from December 1st on, so that your ad hoc, part-year rate doesn't put you uncomfortably over or under the bar next year:

Your withholding status continues unchanged until you file a new W4!

Adjust your withholding:  Step 1
If your tax preparer or tax-preparation software hasn't already recommended specific changes (or an estimated-tax payment schedule), you'll find federal and state tax worksheets attached to the paper UC-W4 form---also posted in .pdf format at bencom/UC For Yourself (see  above).

The California W4 worksheet will yield a flat-dollar, additional monthly amount to be withheld over the rest of the year---over and above your current basic and flat-dollar state withholding (if any). You may enter the new, total flat-dollar amount in section IV, line 2 of the UC-W4, and complete (or leave) the basic state status field (Section II) unchanged.

If you are due a withholding break instead (you come up with a minus dollar adjustment), see Step 2(a) below.

The federal W4 worksheet's designed to recommend a basic annual withholding status/allowances set-up. If you're changing status mid-year, unfortunately,  it's problematic to translate this recommendation into reliable part-year figures. For this reason you may prefer to consult the very complete and methodical:

IRS Publication 919, "How Do I Adjust My Tax Withhholding"

---which may be ordered from the IRS (800 829-3676), obtained in copy from LHRD, consulted in GSSI, or downloaded from the IRS website:
http://www.irs.gov/forms_pubs/index.html

Step 2: Refigure your withholding --- quicker but dirtier
If your annual adjustment isn't terribly big, or you just can't deal the additional arithmetic required to recalibrate your overall withholding status, the flat-dollar-only adjustment method has the virtue of being easily identified (by its own separate line on your W4 and paystub), and therefore readily canceled or changed next year.

If you find you must make a sizeable withholding adjustment and/or have had a family status change since you last tinkered with your withholding, you may be better off in the long run adjusting your overall withholding set-up (personal/family status and allowances)---possibly including flat-dollar adjustments, too.

Use data from your latest paystub, plus projected additional household income or deduction/credit amounts from non-UC sources, with these worksheets. The latter are often most easily lifted from last year's tax returns, adjusted as appropriate for changes that you anticipate both in income and deduction/credit categories, this year.

You may transfer the additional flat-dollar amounts calculated using the foregoing worksheets to Section IV of your UC-W4.

• Remember to *add back* into the total new amounts on these lines, any current flat-dollar amounts that you've included in your projected, current annual withholding.

 
• Remember, too, that the 12-check UC payroll/tax year  begins each year with wages earned in December of the preceding year & paid on or after January 1st, and ends with November earnings paid in December.

Step 2(a)  (deep-tissue withholding massage)
Particularly if you find yourself needing to make a sizeable withholding adjustment (up or down), or have never yet caught your withholding up with a family status change, you may want to adjust your basic withholding set-up, instead of or in addition to flat-dollar, part-year adjustments.

1.  As in the W4 and IRS worksheets (above), subtract your year-to-date, cumulative withholding totals (from your latest paystub), from your projected 2001 tax totals---or from your own share of household taxes, if appropriate.

2.  Divide the federal and state remainders by the number of paychecks remaining through December 1st (or 8th), to determine your desired new monthly dollar withholding rates for the rest of 2001.

3.  Now translate the desired dollar rates into withholding status codes, using the federal and state monthly withholding worksheets posted at the campus Payroll Office website:
http://fbs.berkeley.edu/PAYROLL/taxes/index.htm

---adding or subtracting allowances, or changing your basic status:  single/married, dual income;  married, single income; or for California, head of household.

Withholding status need NOT correspond with actual filing status on your year-end 1040 and 540.

You may also want to add, drop, or change flat-dollar additional withholding amounts, to 'fine-tune' your withholding over the rest of the year.

Step 3:  Making the changes
Enter the withholding status codes, numbers of allowances, and any desired flat-dollar additional amounts from the preceding steps, on form UC-W4---or online at bencom/UC For Yourself. >Each new W4 should be completed in all applicable fields, since it supersedes the last W4 you filed.

Watch your next paystub to be sure your corrections have taken effect as intended: Withholding status codes appear at the top of your paystub or SUREPAY statement, and basic and additional federal and state payments are itemized separately in the current deductions column.

Automated assistance with withholding adjustments---NOT tax advice---is available by appointment at LHRD. Be sure to bring with you your latest paystub and any other household income and tax-payment information (such as copies of your 2000 tax returns, your spouse's latest paystub, etc.) that you wish to take into account, when you come in.

Step 4: A perfectly legal tax dodge
Particularly if you find you can lower your monthly tax payments---or if you're just vaguely nauseated by how much you have to pay---consider as your very next step a visit to the bencom Contributions page, where you may tuck some or all of your new monthly margin into your UC Savings account online---or if you prefer, file a paper form here on campus.

Since 403(b) contributions will further reduce your taxes *and* withholding automatically, remember that you can probably safely redirect anywhere from 1-1/4 to 1-1/2 times the amount of withholding you anticipate saving (if you're in the Tax Refund corral), to 403(b)contributions, without giving up a nickel of take-home pay.
 

    HOME