(1) An employee is
required to provide a completed Form WT-4, "Employee's Withholding Exemption
Certificate/New Hire Reporting," to their employer.
(2) An employee who had incurred no Wisconsin
income tax liability for the preceding taxable year and anticipates no
liability for a current taxable year shall be exempt from withholding if the
employee provides his or her employer with a completed Form WT-4, "Employee's
Withholding Exemption Certificate/New Hire Reporting" which shows a claim for
total exemption. For this purpose, a tax liability is "incurred" if the
employee had for the preceding year, or anticipates for the current year, a net
Wisconsin income tax due, i.e., gross tax less personal exemptions on a
Wisconsin return. If an employee is married, the Wisconsin marital property
laws for tax computation shall be considered in determining if the employee may
claim this exemption.
(3)
(a) Effective April 1, 1979, an employee may
enter into a written agreement with his or her employer to withhold a lesser
amount of tax than indicated in the withholding tax tables, if the employee
determines the lesser amount approximates the employee's anticipated income tax
liability for the year. Form WT-4A, "Wisconsin Employee Withholding Agreement",
shall be used for this purpose and a completed copy of the form shall be sent
by the employee to the department within 10 days after it is filed with the
employer. If the employee fails to notify the department within the required 10
days, he or she shall be subject to a penalty of $10, as provided by s.
71.83(1) (a) 5,
Stats.
(b) The agreement between
the employee and employer shall be renewed each year. For calendar year
taxpayers, the agreement expires on April 30 of the year immediately following
the year in which it was entered into. For fiscal year taxpayers, the agreement
expires 4 months following the close of the fiscal year in which entered into.
To renew the agreement, an employee shall provide a new form WT-4A to his or
her employer and submit a copy of the completed form to the department as
provided in par. (a). If a new form WT-4A is executed before the expiration
dates described in this paragraph, it shall supersede the previous
agreement.
(c) If the department
determines that an agreement is incomplete, incorrect, or would result in an
insufficient amount of tax being withheld, the department may void the
agreement by notification to the employer and employee.
(d) Section
71.83(1) (b) 4,
Stats., provides that any employee who enters into an agreement with the intent
to defeat or evade the proper withholding of tax, shall be subject to a penalty
equal to the difference between the amount required to be withheld and the
amount actually withheld for the period that the incorrect agreement was in
effect.
(e) Under s.
71.83(2) (a) 5,
Stats., any employee who willfully supplies an employer with false or
fraudulent information regarding an agreement with the intent to defeat or
evade the proper withholding of tax may be imprisoned not more than 6 months or
fined not more than $500, plus the costs of prosecution, or
both.
Section Tax 2.92 interprets ss.
71.66 and
71.83(1) (a) 5. and (b) 4. and (2) (a)
5,
Stats.
