Human Resources

Multi-State Withholding

SIUE is required to withhold the appropriate state and local earnings taxes according to each employee's work location(s). Many employees have only one work location, but others may have multiple assigned work locations. Some employees may also work full-time in another state such as Missouri. In those cases, the employee is subject to pay tax in the state in which they work even if they live in another state. Due to our proximity to the St. Louis area, some employees will work in and have Missouri tax withheld and in some cases have St. Louis city tax withheld as well.

Each state and municipality has different employer filing requirements. When those requirements are met, the University must withhold the appropriate state and local tax. Illinois currently has reciprocal agreements with certain states; this means that we do not withhold those states' taxes. The states that currently have reciprocal agreements with Illinois are:

• Iowa
• Kentucky
• Michigan
• Wisconsin

For all other states, when we meet the employer filing requirements, we must begin withholding and reporting to that state.

Earnings tax withholding is calculated using where the employee works, not where the employee lives. For employees who work in both Illinois and Missouri during the year, earnings will be taxed by the location and percent of time of where they worked. For example, if an employee worked 40%  in Missouri and 60% in Illinois, then their total gross earnings will be taxed 40% by Missouri and 60% by Illinois. These employees do not pay tax to both states on the same earnings. Employees who work outside of Illinois will need to file an annual income tax return with both states and file a credit for the state in which they are not a resident.

An employee's work location and percent of time is determined by their department and is reported to Payroll for withholding purposes. If a work locations in Missouri is also within the St. Louis city limits, the University is required to withhold the 1% St. Louis City earnings tax as well. There is not a St. Louis City tax withholding form since the tax is a flat percentage of earnings. Employees who are determined to have a work location in another state will be required to complete the appropriate withholding form for that state.

More information on Missouri Individual Income Tax can be found at https://dor.mo.gov/business/withhold/. Information on St. Louis City earnings tax can be found at https://www.stlouis-mo.gov/collector/earnings-tax-forms-info.cfm.

Out-of-State Withholding for Non-Reciprocal States

If you are working entirely outside the State of Illinois, you must also have on file a withholding form for the state of your primary work location. Below is a list of the states that require a separate withholding form.

States that collect earned income but don't have a W-4 equivalent

The following states do not have state W-4 equivalents but do collect income tax:

• Colorado
• Delaware
• Idaho
• Montana
• New Mexico
• North Dakota
• Pennsylvania
• South Carolina
• Utah

States that don't collect earned income tax

The following state do not collect income tax on earned income:

• Alaska
• Florida
• Nevada
• New Hampshire
• South Dakota
• Tennessee
• Texas
• Washington
• Wyoming