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Prevent a tax from being calculated
Prevent a tax from being calculated

Learn how to mark taxes as exempt

Updated over a week ago

Certain scenarios require a tax exemption. To mark a certain tax exempt, follow these steps.

First determine who is getting taxed

  • Employer tax: you'll need to edit the company

  • Employee tax: you'll need to edit the employee

If it's an employer tax

Go to edit your company. All applicable federal, state and local taxes are listed in the Employer Taxes page. To turn off a tax, toggle the "Exempt from..." switch to be ON.


If it's an employee tax

Go to edit your employee. Determine if it's a federal tax OR a state tax.

Federal taxes

Federal taxes are listed in the "Federal Taxes" page. At the bottom you can toggle on/off federal employee taxes:

  • Federal income tax

  • Medicare

  • Social Security

To stop calculating a tax, toggle the "Exempt from..." checkbox to be ON.

State and local taxes

State taxes are listed in the "State Taxes" page. Find the tax you want to stop calculating and toggle the "Exempt from..." switch to be ON.

Benefits

Benefit taxes are determined based on the benefit type selected. These settings can't be customized.

After you save your changes, the next payroll run will not calculate these taxes. Happy calculating!

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