Federal & State Regulations | Employment taxes - West Virginia

State Info

Summary of differences between federal and state regulations

Income tax withholding

In West Virginia, tax returns must be filed by employers who are required to withhold tax from wages they pay to their employees. The frequency of filing withholding tax returns depends on the amount of tax the employer withholds. Every employer who withholds more than $250 per month must file monthly withholding returns with the State Tax Department. Employers who withhold less than $250 per month are required to file quarterly returns. The State Tax Department may permit an employer who withholds less than $150 in a calendar quarter and the aggregate for the calendar year can reasonably be expected to be less than $600 to file an annual return. Employers whose average withholding tax payment per calendar month for the preceding calendar year exceeded $100,000 are required to remit the tax attributable to the first fifteen days of June on or before June 23 each year. The employer may elect to remit an amount equal to 50 percent of the employer's liability for compensation payable or paid to employees in May. The amount of tax paid for the first fifteen days of June is credited against the total liability for the month of June.

Partnerships, S corporations and trusts who have nonresident partners or shareholders or beneficiaries must withhold tax from the income paid to these individuals and corporations at a rate of 4 percent if the organization has income derived from West Virginia sources. Where the income is paid to a corporation, the tax is applied against the Corporation Net Income Tax liability. Individual shareholders may elect not to have tax withheld from their income distribution through execution of a pass-through entity agreement.

Unemployment taxes

All states finance UC primarily through contributions from subject employers on the wages of their covered workers. In addition, three states (Alaska, New Jersey, and Pennsylvania) collect contributions from employees. These taxes are deposited by the state to its account in the UTF in the Federal Treasury, and are withdrawn as needed to pay benefits.

Many states have adopted a higher tax base than what is provided in FUTA. Hawaii's wage base is usually higher and changes periodically. In all states, an employer pays a tax on wages paid to each worker within a calendar year up to the amount specified in state law. In addition, most of the states provide an automatic adjustment of the wage base if federal law is amended to apply to a higher wage base than that specified under state law. As a result of the many variables in states taxable wage bases and rates, benefit formulas, and economic conditions, actual tax rates vary greatly among the states and among individual employers within a state.

Wages subject to unemployment tax in this state equal $8,000.

Minimum and maximum rates in this state are 1.5 and 7.5 %. Rates apply to experience rated employers only and do not include applicable surtaxes or penalties.