State Tax Withholding

The University is registered in the following states/locations: California, Colorado, Connecticut, District of Columbia, Florida, Indiana, Maryland, Massachusetts, Michigan, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Texas, Utah, Virginia, and Wisconsin

Employees physically located in one of the above states must have their locations updated in Workday for proper tax reporting and withholding (not just primary address or work from home address). Payroll would like to remind everyone of the below regarding work locations and state tax withholding.

  • An employee can only complete a non-Illinois withholding form if he/she/they work in a state the University of Chicago is registered in. If the employee works in a registered state, he/she/they can elect withholding for the work state by completing the appropriate electronic state form (if applicable by state).  The work location must also reflect the same state in Workday.
  • If an employee works in Illinois, but is claiming a reciprocal agreement with Michigan or Wisconsin, the employee must complete the appropriate Michigan or Wisconsin state withholding form listed in Workday and complete an IL-W-5-NR to stop Illinois state tax withholding. The employee’s home address must also reflect Michigan or Wisconsin in Workday.
  • If an employee works in Illinois, Payroll is required to withhold Illinois state withholding unless the employee claims exempt from Illinois state withholding per state regulations.
  • The University does not withhold Indiana state taxes unless the employee works in Indiana; this also includes Indiana county taxes.

If we are not registered in a state, then the individual is responsible for reporting and remitting taxes to that state on their own. Also, if Workday is not updated timely and appropriately upon return, this may cause an under withholding of taxes to the individual. Ultimately, each employee is responsible for understanding and monitoring their own state tax liabilities.