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Payroll Tax Information

Payroll Tax Information

The University of Kentucky is required by law to withhold taxes from various types of earnings paid to our faculty, staff, and students. Employees are generally taxed according to the university’s primary place of business, which is Kentucky. These earnings are paid through monthly and biweekly payrolls. After each payroll processing, the taxes withheld are sent to federal, state and local agencies on behalf of the employee. At the end of each calendar year, University Payroll Services reports annual income and tax withheld on a form W-2 or 1042S. Faculty, staff or students receiving one of these forms will need to file an income tax return with federal and state agencies by April 15th of the following year.

At this time, myUK Employee Self-service should be used to update only Federal and Kentucky income tax withholding.  

Current tax forms are located here https://www.uky.edu/ufs/payroll-services-tax-form-links

For tax withholding purposes, the University of Kentucky is currently registered in Kentucky and the following 21 states. 

  • Phase I - July 2022 payroll included FL, GA, IL, IN, NC, OH, TN, TX, and VA.  
  • Phase II - August 2022 Payroll included MI, MN, SC, and WV.  
  • Phase III - September 2022 payroll included: AR, MA, MD, MO. 
  • Phase IV - January 2023 payroll included: AL, NY, PA, WA.

The University is not withholding state and local taxes for states other than Kentucky and the 21 identified above.  

For all other employees, whose primary work location is NOT Kentucky or one of the 21 states where the University is registered, quarterly tax estimates should be filed and paid to the applicable state and local authorities.

Employees, whose primary work location is one of the 21 identified states,  who wish to update their state income tax withholding must complete a Remote Work Location Form and a state income tax withholding certificate for their perspective state and submit it to ukpayroll@uky.edu.

Note: Payroll Services cannot provide tax advice.  We strongly encourage employees to seek your own tax professional or contact the IRS.

 

FAQs related to work location:​

1. Do I need to change my federal W-4 form?

Your federal income taxes withheld from your pay are not affected by work location. The Internal Revenue Service suggests employees review their W-4 each year and complete a new W-4 when their personal or financial situation changes.

2. How do I update my withholding for state taxes?

  1. Validate your remote work address by following instructions provided here.
  2. Complete the Remote Work Location – Outside of Kentucky form located here. 
  3. Complete a withholding form for the appropriate state(s) located here.  
  4. After completing and electronically signing the forms in steps 2 and 3, using your UK email account, submit the forms via email to ukpayroll@uky.edu,

These four steps are critical to ensuring not only that the university complies with taxation and employment laws, but that you receive the correct net payment.

3. Which states is the University registered in for tax withholding?

The University of Kentucky is registered in Kentucky and the following 21 states. 

  1. Phase I - July 2022 payroll included FL, GA, IL, IN, NC, OH, TN, TX, and VA.  
  2. Phase II - August 2022 Payroll included MI, MN, SC, and WV.  
  3. Phase III - September 2022 payroll included: AR, MA, MD, MO. 
  4. Phase IV - January 2023 payroll included: AL, NY, PA, WA.

4. When will the University register for tax withholding for additional states?

The University plans to register for tax withholding in additional states based on the number of individuals authorized to work in other states. The goal is to prioritize registration in states with two or more employees in the first quarter of 2023.

5. I have been approved to be fully remote in one of the states that University of Kentucky is registered to do business (i.e. Ohio), how will this impact my state payroll withholdings?

Once approved with an effective date, you will no longer have Kentucky state specific taxes withheld from your pay. Instead, you will be treated as an Ohio employee with all applicable Ohio state withholding taxes deducted from your pay.

6. I am fully remote in one of the states that the University of Kentucky has NOT registered to do business (i.e. Oregon); how will this impact my state payroll withholdings?

Until you submit the information requested below, you will be taxed according to the university’s primary place of business, which is Kentucky. All applicable KY payroll withholdings will be withheld from your pay.

Using your UK email account, submit a request via email to ukpayroll@uky.edu to provide your name, person id, work address, department name and contact phone number that can verify your work address and effective date. You must also include a statement saying you request to be exempt from Kentucky state taxes and you understand the University of Kentucky is not able to collect taxes for other states at this time and that you will be responsible for paying any due tax to the current state in which you reside. You should file and pay quarterly estimates to the applicable state and local agencies since the University is not withholding state and local taxes.

7. I live in one of the following reciprocal states (Illinois, Indiana, Michigan, W. Virginia, Wisconsin, Virginia, or Ohio) how will this impact my state payroll withholdings?

If you live in one of the reciprocal states, you must complete the Kentucky’s K-4 form, line 4 on page one and section 4 on page two. After completing and electronically signing the form, using your UK email account, submit the forms via email to ukpayroll@uky.edu

8. I am considered a hybrid employee working in both Kentucky and Ohio. How will my state payroll withholdings be handled?

You would need to complete a withholding form for the appropriate state(s) located here.  Taxes will be withheld based on the percentage of work time reported for each work state (i.e. 60% Kentucky, 40% Ohio) with the pro-rata state payroll taxes withheld from your pay.

Remember It is the employee’s responsibility to keep their personal data accurate in myUK Employee Self Service.

9. I am an international faculty, staff, or student, who is considered a Non-Resident Alien by the Internal Revenue Service. How will my payroll withholdings be handled?

Within this page https://www.uky.edu/ufs/payroll-services-non-resident-alien we have provided links to relevant tax information and NRA documents