Mandatory Tax Withholding
Social Security and Medicare taxes are payroll deductions mandated by the Federal Insurance Contributions Act (FICA). The combined tax rate is 7.65 percent of total gross income, consisting of 6.20 percent for Social Security and 1.45 percent for Medicare. There are maximum earnings limits established each year as taxable maximums for Social Security. See annual updates.
Exception to Mandatory Withholding: Students at the University who are enrolled in a half-time or more student schedule may be exempt from FICA withholdings. Half-time schedules are equivalent to 5 credits minimum per term for graduate students and 6 credits per term minimum for undergraduate students. It is important to know that if at any time enrollment drops below that level or as a student you are working in a non-student position, FICA withholding will be required.
Federal Income Tax
Federal Income tax is withheld according to a Federal Tax Table titled "Publication 15—Circular E, Employer's Tax Guide." The Federal Tax Tables display figures that reflect a combined total for income tax plus Social Security and Medicare taxes. The PSU payroll system utilizes figures listed under the annualized formula to calculate your withholding.
Oregon Income Tax
The Oregon Tax Tables are found in the Oregon Withholding Tax Tables and the Oregon Withholding Tax Formulas can be found here. It is recommended that you reference "Things You Need to Know" to gain relevant information for your income and needs. The PSU payroll system utilizes the monthly tax tables to calculate your withholding.
Additional Information Available Regarding Payroll Taxation
The following links will assist employees in gaining information related to payroll taxation for U.S. Citizens, Resident Aliens, Substantially Present Persons and Non-Resident Aliens.
To find more information on setting up your tax deductions on Form W-4, understanding tax returns, Federal and State tax tables and how to read your pay stub, visit the links provided below. In addition, you'll find information on tax treaties, CO-NRA, Substantial Presence Test and general terminology.