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Tax Questions

What is FICA?
What is federal and state withholding?
What does "EXEMPT" on the W-4 mean?
How do I change the number of withholding allowances on my W-4?
I submitted a new W-4 and I don't see the changes on my last paycheck. Why wasn't this changed?
How much tax will be withheld from my paycheck?
Are student earnings automatically exempt?
What is the Earned Income Tax Credit (EITC)?
If I work for both SDSU and SDSURF do I have to pay FICA at both institutions?


What is FICA?

FICA (Federal Insurance Contribution Act) is also known as social security tax. It is composed of OASDI (Old Age, Survivors and Disability Benefits) and Medicare. All employees, except for certain non-resident aliens and students enrolled in at least half time status, must pay these taxes.


What is federal and state withholding?

Federal and state withholding are income taxes. SDSURF uses the withholding allowances and marital status claimed on your Form W-4 and/or DE-4 to determine the amount of tax to withhold from your wages for federal and state withholding.


What does "EXEMPT" on the W-4 mean?

When you claim exempt from withholding, it means that you expect to have no tax liability on your personal tax return at the end of the calendar year. In order to claim exempt from federal withholding, you need to complete a Form W-4 and write the word "EXEMPT" on line 7. Refer to IRS Form W-4 instructions for more details, and to determine if you qualify to claim exempt. You must renew your exemption status every calendar year by February; otherwise taxes will be withheld. It is your responsibility to re-file as necessary.


How do I change the number of withholding allowances on my W-4?

Changes in federal withholding tax status, whether for family status changes or to add an addition amount of withholding, are done by completing a new IRS Form W-4. Fax your new form to 619-594-3177, email to SDSURF Payroll, or bring your newly completed tax forms to the Payroll department.


I submitted a new W-4 and I don't see the changes on my last paycheck. Why wasn't this changed?

The Payroll department may not have received the form in time to make the changes in the payroll system. Your next pay check should reflect the changes.


How much tax will be withheld from my paycheck?

Federal and State income tax withholding is based upon the personal allowances you indicated on your W-4 and/or DE-4 form. Other taxes are withheld as indicated in the table below:

2007 Tax Rates

Type Rate Wage Base Maximum Withholding
FICA OASDI 6.2% $97,500 $6,045.00
FICA MEDICARE 1.45% No limit No limit
CA SDI 0.60% $83,389.00 $500.33
CA UEI 2.0% $7,000 $140.00

Are student earnings automatically exempt?

No. Refer to the Student Questions for more information.


What is the Earned Income Tax Credit (EITC)?

The EITC is a special credit, for qualified employees, that reduces the amount of tax owed (if any) and is intended to offset some of the increases in living expenses and social security taxes. Submit a completed Form W-5 to the Payroll department in order to claim this credit. For additional information, refer to the IRS website for forms and instructions.


If I work for both SDSU and SDSURF do I have to pay FICA at both institutions?

An employer may not take into consideration wages paid to an employee by another employer in a calendar year. SDSU and SDSU Research Foundation are separate employers and both are subject to payment of FICA taxes. However, IRS code 6413(c)(1) provides that an employee is entitled to a credit or refund of FICA taxes collected with respect to excess wages received by more than one employer within any calendar year. This may be claimed when you file your annual tax return.


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