How to fill out MW507 Form

Information on how to fill out the MW507 Form is provided here. The Employee’s Maryland Withholding Exemption Certificate is the Maryland Form MW 507. The MW507 form must be completed in order for you to determine how much state income tax to deduct from the pay of your new employee.

If an employee fails to file for withholding tax for whatever reason, you must withhold tax as if the person had claimed no exemptions.

In addition, if a married employee fails to declare his marital status on the form, the employer must withhold using the “single employee” withholding tables.

Because the withholding rates for single employees are greater than those for married employees, and the amount of tax taken from a particular salary payment falls as the number of exemptions claimed grows, it is critical that you require all employees to submit the necessary certifications.

The law requires you to fill out an Employee’s Withholding Allowance Certificate so that your employer, the state of Maryland, may deduct federal and state income taxes from your compensation. Your existing certificate is valid until you replace it.

Instructions for Completing the MW507 Form

If you previously filed as “EXEMPT” from federal or state withholding, you must submit a new certificate each year by February 15th.

Fill in the blanks on the Employee’s Withholding Allowance Certificate as follows: Section 1 — Employee Details

– Please review the Payroll Type — Regular (RG), Contract (CT), or University of Maryland (UM)

– Name of the Employing Agency — Enter the name of the agency.

• Agency ID — Assigned by the Agency Payroll Office
• SSN (Social Security Number) of the employee

Employee Name — Full first name, middle initial, and last name

– Residential Address — Street name and number or R.D. number

– Continued Address — Apartment number or P. O. Box number Residents of Pennsylvania enter the township or borough in where they live.

— City, state, and postal code — Enter the whole five-digit zip code; abbreviate the state.

– County of Residence — Enter the Baltimore City or Maryland County where you currently live.

Section 2 — W-4 Form for Federal Withholding

Section 2 may be completed online at: http://www.irs.gov/pub/irs-pdf/fw4.pdf.

Section 3 — Form for State Withholding (Choose Appropriate Form)

– Maryland (Form MW 507) — — — — — — — — — — Section 3 must be completed online at: http://forms.marylandtaxes.com/current forms/mw507.pdf

– D.C. (Form D-4) To finish part 3, go to: http://otr.cfo.dc.gov/otr/frames.asp?doc=/otr/lib/otr/tax/forms/D-4.pdf.

– WV/IT-104) — Section 3 may be completed online at: http://www.state.wv.us/taxrev/uploads/it100-1-a.pdf

Section 4 — Employee Signature — You must sign this section. Without being signed, Withholding Forms are not valid.

Instructions for Filling the Employee’s Federal Withholding Allowance

W-4 Form (2011)

Purpose. Fill out Form W-4 so that your employer may deduct the right federal income tax from your paycheck. Consider filing a new Form W-4 each year and whenever your personal or financial circumstances change.

Withholding exception. If you are exempt, just fill out lines 1, 2, 3, 4, and 7, and sign the form to authenticate it. Your 2011 exemption expires on February 16, 2012. Refer to Publication 505, Tax Withholding and Estimated Tax.

If someone else may claim you as a dependant on his or her tax return, you cannot claim withholding exemption if your income exceeds $950 and contains more than $300 in unearned income (for example, interest and dividends).

The fundamentals. Fill out the Personal Allowances Worksheet if you are not exempt. The forms on page 2 enable you to change your withholding allowances further depending on itemized deductions, specific credits, income modifications, or two-earner/multiple employment circumstances. Complete all of the worksheets.

that are applicable You may, however, claim smaller (or no) allowances. Withholding on regular pay must be dependent on allowances claimed and cannot be a fixed sum or percentage of wages.

The head of the home. In general, you may claim head of household filing status on your tax return if you are unmarried and pay more than half of the expenses of maintaining a residence for yourself, your dependent(s), or other qualified persons. For further information, see Pub. 501, Exemptions, Standard Deduction, and Filing Information.

Tax breaks. You may factor in expected tax credits.

in determining the quantity of withholding allowances you are permitted to claim. Child or dependent care expenditures, as well as the child

The Personal Allowances Worksheet shown below may be used to claim a tax credit. For details on translating your other credits into withholding allowances, see Pub. 919, How Do I Adjust My Tax Withholding.

Nonwage earnings. If you have a significant amount of nonwage income, such as interest or dividends, you might consider making anticipated tax payments on Form 1040-ES, Estimated Tax for Individuals. Otherwise, you may be required to pay extra tax. If you receive a pension or an annuity, see Pub. 919 to determine if you should alter your withholding on form W-4 or W-4P.

Two income earners/multiple jobs If you have a partner who works,

With more than one employment, calculate the total number of allowances you are eligible to claim on all occupations using worksheets from a single Form W-4. When all allowances are claimed on Form W-4, your withholding will be most accurate.

For the highest-paying employment, no allowances are claimed, whereas none are claimed for the rest. For further information, see Publication 919.

Non-citizen alien See Notice if you are a nonresident immigrant.

1392, Nonresident Supplemental Form W-4 Instructions

Before completing this Form, Aliens.

Examine your withholding. After your Form W-4 is effective, utilize Pub. 919 to compare the amount you have withheld to your expected total tax for 2011. See Publication 919, particularly if your wages surpass $130,000 (single) or $180,000 (married) (Married).

Is there a new name? If the name on line 1 varies from the name on your social security card, contact 1–800–772–1213 to request a name change and a new social security card.

EMPLOYEE’S STATE OF MARYLAND WITHDRAWING ALLOWANCE IN 2011 INSTRUCTIONS

1st Line

Withholding Allowance for Employees

Certificate

a. The number of personal exemptions (the total number of exemptions on lines A, C, and D of the

federal W-4 or W-4A form a.

c. The total number of new exemptions for

dependents above the age of 65 b.

c. The number of extra exemptions for certain items, such as projected itemized deductions, alimony payments, authorized childcare expenditures, qualifying retirement contributions, and business expenses.

employee business and losses

b. Expenses for the year

c. At least one extra exemption for the taxpayer and/or spouse

65 years of age or older and/or blind d.

e. Total — combine lines a through d and multiply by

Fill in the blanks on line 1 (Form MW507) with an e.

Exemptions for dependents — To qualify as a dependent, you must be eligible to a dependent exemption on your federal income tax return for the relevant tax year.

Additional exemptions for dependents above the age of

65 years of age — Dependents 65 years of age or older are eligible for an extra exemption.

Additional exemptions — For certain items, such as projected itemized deductions, alimony payments, acceptable child care expenditures, qualifying retirement contributions, company losses, and employee business expenses for the year, you may claim additional exemptions. One more withholding exemption

is allowed for every $3,200 in projected itemized deductions or income adjustments that exceed the standard deduction amount.

NOTE: The standard deduction is 15% of Maryland adjusted gross income, with a minimum of $1,500 and a maximum of $2,000 for each taxpayer.

Additional exemptions for the taxpayer and/or spouse — An additional $1,000 may be claimed if the taxpayer and/or spouse

On the final day of the tax year, the taxpayer and/or spouse are at least 65 years old and/or blind.

Line №2

Extra withholding per pay period

under agreement with employer — if you do not have enough tax deducted, you may request further withholding from your employer by putting an additional amount on Line 2.

3rd line

Withholding exception. You may be eligible for an exemption from withholding.

If you live in Maryland and:

a. you did not owe any Maryland income tax last year and were entitled to a full refund of any tax withheld; and

a. You do not expect to owe any Maryland income tax this year and expect to be entitled to a full refund of all income tax withheld. If you are eligible, please fill out the form below.

Your employer will not withhold any taxes as a result of this exemption.

Maryland income tax is deducted from your paycheck.

Students and seasonal workers –

whose yearly income will be less than the filing threshold (annual income less than

$9,350 in 2011) should claim withholding exemption. This generates additional money throughout the year and eliminates the need to file a Maryland income tax return.

4th line

Certification of non-residence in the State of Maryland- This section must be filled out by residents of Pennsylvania and Virginia who work in Maryland but do not have a place of habitation in Maryland for 183 days or more.

Line 4 should not be utilized by residents of other states who work in Maryland since they are subject to Maryland income tax and must have withholding deducted from their salaries.

If you are domiciled in the District of Columbia, Pennsylvania, or Virginia and keep a place of habitation in Maryland for 183 days or more, you become a statutory resident of Maryland and are obliged to submit a resident return with Maryland detailing your total number of days spent in the state.

income. You must apply to your domicile state for any tax credits that you may be eligible to under the law’s reciprocal provisions.

If you are a West Virginia resident, you are not required to pay Maryland income tax on wage or salary income, regardless of how long you have lived in Maryland.

5th line

You may be excluded from Maryland income tax on your pay under the Servicemembers Civil Relief Act, as modified by the Military Spouses Residency Relief Act, if

I your spouse is a member of the armed services stationed in Maryland in accordance with military orders; (ii) you are in Maryland only to be with your spouse; and (iii) you have your primary residence in another state. Enter your state of residence if you claim exemption under the SCRA.

on Line 5; type “EXEMPT” in the box to the right on Line 5; and attach a copy of your spouse’s military identity card to Form MW507.

INSTRUCTIONS GENERAL Information under the Federal Privacy Act –

Social Security numbers are required. The requirements of the Annotated Code of Maryland’s Tax-General Article permit the compelled publication of your social security number. READ MORE