Iowa Withholding Tax Booklet And Tax Tables - 2005 Page 12
ADVERTISEMENT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28Iowa Department of Revenue
Find us on the Web at
Example: Biweekly wages of $740 (3 total personal allowances claimed, no
additional amount requested)
T 1 = G - W
T 1 = $740.00 - $6.28
= $733.72
T 2 = T 1 - S
T 2 = $733.72 - $138.46
= $595.26
T 3 = T 2 x R
T 3
0.0036 x
1st $ 48.81
= $ 0.18
0.0072 x
next $ 48.81
= $ 0.35
0.0243 x
next $ 97.62
= $ 2.37
0.0450 x
next $244.04
= $ 10.98
0.0612 x remaining $155.99
= $ 9.55
T 3 = $23.43
T 4 = T 3 – (CxN)
T 4 = $23.43 - ($1.54 x 3)
= $ 18.81
T 5 = T 4 – (A÷P)
T 5 = $18.81 - (0 x 24)
= $ 18.81
Iowa tax to be withheld=$18.81 (Rounded = $19.00)
INSTRUCTIONS FOR ANNUALIZED FORMULA
The annualized formula is identical to the regular formula with one overall
modification.
In step T 1 , wages are multiplied by the number of pay periods in a year to arrive at
annual wages. Then in each subsequent step (T 2 - T 4 ) annual values are used. See
the following page for alternate rates to be entered at Step T 3 . Finally, in step T 5 ,
the annual liability is divided by the number of pay periods in the year to arrive at
the tax for the pay period.
Example: Monthly wages of $1,750 (4 total personal allowance claimed)
T 1 = (G - W) x P
T 1 = ($1,750.00 - $1.63) x 12 months =
$20,980.42
T 2 = T 1 - S
T 2 = $20,980.42 - $3,600.00
=
$17,380.42
T 3 = T 2 x R
T 3 = 0.0036
x 1st $1,269.00
=
$ 4.57
0.0072
x 2nd $1,269.00
=
$ 9.14
0.0243
x next $2,538.00
=
$ 61.67
0.0450
x next $6,345.00
=
$285.53
0.0612 x remaining $5,959.00
=
$364.72
T 3
= $725.62
T 4 = T 3 – (C x N)
T 4 = $725.62 - ($40 x 4)
=
$565.62
T 5 = T 4 + A
T5 = $565.62 + $0
=
$565.62
T 5 = T 4 ÷ P
T 5 = $565.62 ÷ 12
=
$47.13
Iowa tax to be withheld = $47.13 (Rounded = $47.00)
11
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Financial