US Payroll Instructions



US Federal Withholding Instructions

Enter the number of claimed exemptions in the Fed Exemptions field in each Employee account.

Use the following to determine the value for the Marital Status popup menu in each Employee account:

  • Single- single employee with one personal exemption
  • Married- married employee with two personal exemptions
  • Dual Income- married employee with one personal exemption
  • Head of House- employee claims Head of Family status
  • Other- not used

NOTE--: A few states use slightly different conditions for the marital status choices. Follow the links at the bottom of this page, to see specific instructions for your state.

If an employee claims additional federal withholding on their W-4 form, enter it into the Fed Withholding field in the Employee account record (click the Payroll Setup button to see it).

Goldenseal will automatically calculate the correct federal withholding for each pay period.

Medicare Employee Withholding

Starting in 2014, there is an additional .9% employee withholding for Medicare that kicks in after an employee has earned $200,000 in a year.

NOTE-- This is the first time we have experienced a deduction that is structured with a bottom limit! Our existing calculators didn't handle this case, but we added it in the version 4.9 update. We now have a deduction line item for the extra .9%, but do not automatically include it. Add it to your Tax Packages, if an employee earns more than $200,000 per year.


The employee withholding rate for Social Security was reduced temporarily, from 6.2% to 4.2%, between Jan 1, 2011 and Dec 31, 2012. As of January 1, 2013 it returned to the original 6.2% rate.

Earned Income Credit

The option to get advance payments of the EIC tax credit expired on Dec 31, 2010. Taxpayers can still get a credit when they file their tax return, and they may adjust their withholding allowances to reduce withholding amounts. However they won't be able to get a credit added to their paychecks for wages in 2011 or later.

We still are keeping the 2010 EIC tax tables available, in case the credit advance is reinstated (although Republicans in power, that is unlikely).

If you previously gave the EIC tax credit to some of your employees, follow these steps to remove it for wages in 2011 or later:

  1. Choose Payroll Setup from the Costs menu, and choose Tax Packages from the submenu.
  2. Click on the Tax Package that includes Advanced EIC credits.
  3. Click the Edit button.
  4. Click on the Advanced EIC item to remove it in the package.
  5. Click OK, then click Close to leave the Tax Package setup.