TAXES 22-03, North Carolina State Income Tax Withholding

Published: February 23, 2022
Effective: Pay Period 03, 2022

Summary

The income tax withholdings for the State of North Carolina includes the following changes:

No action on the part of the employee or the personnel office is necessary.

Tax Formula

State Abbreviation:

NC

State Tax Withholding State Code:

37

Acceptable Exemption Form:

NC-4

Basis for Withholding:

State Exemptions

Acceptable Exemption Data:

S/M/H, Number of Allowances

TSP Deferred:

Yes

Special Coding:

None

Additional Information:

In the event that the employee does not file a State Withholding Allowance Certificate, then Single and zero exemptions (S00) will be used as the basis for withholding.

Withholding Formula (Effective Pay Period 03, 2022)

  1. Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
  2. Subtract the nontaxable biweekly Federal Employees Health Benefits Plan payment(s) (includes dental and vision insurance program and Flexible Spending Account — health care and dependent care deductions) from the amount computed in step 1.
  3. Add the taxable biweekly fringe benefits (e.g., taxable life insurance) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
  4. Multiply the adjusted gross biweekly wages by the number of pay dates in the tax year to obtain the gross annual wages.
  5. Determine the standard deduction allowance by applying the following guideline and subtract this amount from the annual wages:

    Marital Status:

    Standard Deduction:

    Single

    $12,750

    Married

    $12,750

    Head of Household

    $19,125

  6. Determine the exemption allowance by subtracting the amount from the gross annual wages to compute the taxable income.

    Multiply the number of Allowances by $2,500

  7. Multiply the annualized taxable wages calculated in step 6 by 5.09 percent to determine the annual tax amount.
  8. Divide the annual North Carolina tax withholding calculated in step 7 by the number of pay dates in the tax year and round to the nearest dollar to obtain the biweekly North Carolina tax withholding.

Resources

To view the updated tax formula, go to the HR and Payroll Clients page from the MyNFC drop-down menu on the National Finance Center (NFC) Home page. Select the Publications tab and select U.S. Income Tax Formulas from the Publications menu to launch the tax map. Select the desired State from the map provided for the formula.

Previous Tax Bulletin

Inquiries

For questions about NFC processing, authorized Servicing Personnel Office representatives should contact the NFC Contact Center at 1-855-NFC-4GOV (1-855-632-4468) or via the customer service portal at ServiceNow Portal for Federated Users and at ServiceNow Portal for Non-Federated Users.