The number on line 5 of the employee's Form WH-4, State of Indiana Employee's Withholding Exemption and County Status Certificate, should be entered in the TKT Payroll Employee Record field titled "State Tax Allowances....". The additional exemption number claimed by the employee on line 6 of Form WH-4 should be multiplied by the $1,500 per year per qualifying dependent exemption. That dollar amount should be entered in the next to last field of the Employee Record. For example, if the employee claimed the number 3 on line 6 of Form WH-4, then 4500 (3 X 1500) would be entered in the next to last field of the TKT Payroll Employee Record.
The same number of personal exemptions used for state tax also apply to the calculation of county tax; therefore, you should setup the county tax deduction as a percentage of state tax. Please use the following method for the proper withholding of Indiana County tax :
1. Select "Utilities" on the main menu bar.
2. High light "Withholding Rates" and click "Local Tax Settings".
3. Type the county name in the box below "Type Name of Tax Locality".
4. Click the down arrow for "Select Locality Tax Base and click "State Income Tax"
5. Click the "Save" button.
6. Now calculate the percentage relationship of the county tax rate to the state tax rate as follows:
Example for Clay County:
Clay County resident tax rate = .0235
Indiana State tax rate = .0323
divide the rates as follows: .0235/.0323 = .7276
7. Enter the resulting decimal number .7276 in each employee's record in the box to the right of "Local Tax Rate as a Decimal Number or Dollar Amount per pay period ->".
Click the following Indiana website link for the state and county tax rates: