The tax man cometh: PostalEASE provides easy access to change state tax withholding information

With the holidays fast approaching, it’s easy to put off thinking about those post-New Year’s Eve credit card bills, let alone worrying about the springtime ritual of filing income tax returns.

But changes to Postal Service payroll and state tax processes may require some employees to update their state tax withholding information.

The Postal Service earlier this year began validating each employee’s state tax selection by matching it with the employee’s duty station finance number. This validation took into consideration any reciprocity agreements with other states that require income tax withholding for non-residents.

Postal employees with “invalid” state tax selections already should have received a USPS letter notifying them of the need to make changes to their state tax withholding information.

The good news is: It’s as simple as going online.

Employees now may access the Payroll section of PostalEASE to modify State Form W-4 data. There’s no need to mail those changes to the Human Resources Shared Services Center for data entry.

To help make the process as pain-free as possible, drop-down boxes and instructions in the system guide users through the process of making revisions. The system also will notify the employee of the effective pay period for the change, based on when the data is entered.

Adjustments employees may make to their state tax withholding information include changing:

• The name of the state for which taxes are being withheld.
• Filing status (single, married, etc.).
• The number of dependents.
• Additional withholding amounts and percentages (when applicable) to be withheld.

These changes will be allowed only if the state code is valid based on the employee’s assigned duty station finance number.

After Jan. 1, 2011, all employees with an “invalid” state selection will have their withholding tax defaulted to the state of their duty station finance number with their filing status as “Single” and their exemptions set to “0” until they make a change.

Also, if a PS Form 50, Notification of Personnel Action, is processed and includes a change to the assigned duty station finance number, the system will automatically default the state tax code to a valid state with a status of “Single” and exemptions of “0”.

Employees who wish to deviate from these default settings are responsible for making the necessary changes in PostalEASE.