How To Correct Withholding When Employee Moves

One of our employees moved during the year out of the city and to the suburbs. As such, they are no longer subject to the city tax and treated as a resident there. How do we correct it from a payroll perspective?

You should work with your payroll provider to reduce the amount of taxes collected for the city and apply it to the state. For instance, if city taxes were $1,200, then that amount should go to Zero and the state taxes withheld should increase by that same amount. If the employee ends up with higher withholdings than needed by the end of the year, this amount will go towards their state refund.

References: NY Publication 15E
State: New York

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