Payroll Tax Information
Withholding Allowance Certificates
(W-4)
A withholding allowance certificate is required to be completed for the state in which you perform the services for The University of Iowa. Some states use the Federal W-4 form as they do not have their own W-4 form. The State of Iowa has a reciprocal agreement with the State of Illinois. If you are a resident of Illinois and working in Iowa you may chose to have Illinois withholding. Completion of the Iowa W-4 and Illinois W-4 can be done directly on the self service website, except if you are claiming exempt or claiming a large number of allowances then you must complete the paper form. Paper copy links for the following can also be found on the self service website. Reminder: It is good idea to review these W-4 forms in December of every year to see if any changes need to be made.
- Withholding Allowance Certificates for States other than Iowa and Illinois
- Iowa W-4 (pdf)
- Illinois W-4 (pdf)
- Iowa Nonresidence (to be completed with the Illinois W-4) (pdf)
- Federal W-4 Withholding Form (pdf)
- Yearly Review of W-4 Forms
Earned Income Credit (W-5)
- Download/View pdf form on Internal Revenue Service web site
Nonresident Alien Information
- Memo to all nonresident alien Employees (pdf)
- Federal Employee's Withholding Allowance Certificate for NRAs- Sample Form W-4 (pdf)
- State of Iowa Employee Withholding Allowance Certificate - Sample W-4 Form 44019a (pdf)
- For further questions, contact Payroll at payroll-nra-web@uiowa.edu
Paycheck calculator
To determine what effect your W-4 allowances will have on your net pay, you might want to visit the web site of paycheckcity.com, an online collection of paycheck tools. You will need to have a copy of your latest earnings statement. All deductions listed under before-tax deductions are exempt from Federal, FICA and state taxes, except for TIAA-CREF deductions and GSRA; those are exempt from Federal and state taxes.
Fellowship Payments
For individuals who receive fellowship payments through The University of Iowa Payroll Office, the following rules apply:
Fellowship recipients are required to follow the rules imposed by the Tax Reform Act of 1986 revised section 117 of the Internal Revenue Service Code as it applies to Scholarships and Fellowships. Under current law, for degree candidates, only tuition and related expenses such as books, fees, supplies and equipment required for courses can be excluded from income. For recipients who are not degree candidates, no exclusions are allowed.
The University of Iowa cannot help a fellowship recipient determine if their payments are taxable or not. If a recipient is unsure if their payments are taxable, they should consult with a professional income tax preparer.
Fellowship payments to U.S. citizens are not reported on a W-2 or any other income tax reporting document. The total amount of fellowship income that an individual received from The University of Iowa Payroll Office can be found on the self service website shortly after the calendar year-end. The amount can be found in the “My Information” tab under “Year-End Taxes”.
Fellowship payments to Non-Resident Aliens are reported on form 1042-S. Fellowship payments are 14% taxable unless tax treaty covered.
Fellowship payments are not subject to social security or Medicare tax withholding.
Fellowship payments to U.S. citizens do not have any federal or state income tax withholding. If the fellowship recipient determines that their income is taxable, the recipient is required to make quarterly estimated income tax payments to the Internal Revenue Service and to the State of Iowa. The forms and instructions to make the payments can be found at the following websites:
- Internal Revenue Service form 1040ES:
http://www.irs.ustreas.gov/formspubs/lists/0,,id=97817,00.html - State of Iowa form IA 1040ES:
http://www.state.ia.us/tax/forms/withhold.html - Additional information regarding Fellowships may be found in Internal Revenue Service Publication 970 http://www.irs.gov/pub/irs-pdf/p970.pdf
Student FICA information
The employee’s primary reason for being on campus must be for student purposes.
If an individual is employed in a professional position and a student position, they will be required to pay FICA tax on their professional position.
- Nonresident Aliens who are in F1 or J1 immigration status will be “exempt” from FICA tax until they have met the IRS Substantial Presence Test (SPT). This exemption is based on immigration status NOT student status.
- Professional positions typically receive a benefits package, which is a prohibiting factor for FICA exemption.
Graduate students must be registered for 5 credit hours or more during the Fall and Spring Semesters and 3 credit hours or more during the Summer Session to be exempt from FICA tax.
- Graduate students may be exempt from FICA if they are registered for 0-2 credit hours or more and if their department completes a Short Hours Form indicating that the student is engaged in research in fulfillment of a degree requirement, writing a dissertation or thesis, or preparing a prospectus. This form must be registered with the University Registar's Office.
- Graduate students may be exempt from FICA if they have passed their Ph.D. Comprehensive Examination.
Undergraduate students must be registered for 6 credit hours or more during the Fall and Spring Semesters and 3 credit hours or more during the Summer Session to be exempt from FICA tax.
Nonresident Aliens who are currently in an F-1 or J-1 immigration status are exempt from FICA UNTIL they meet the IRS Substantial Presence Test (SPT).