Out-of-State Income Tax Withholding
To ensure state, county, and/or local income tax deduction (i.e., withholding) is occurring accurately, timely, and appropriately for all locations in which an employee performs work, for which the University is required to withhold taxes.
All employees, including faculty, staff, and students.
The University of Kansas strives to adhere to the taxation rules and regulations of each state, county, and local jurisdiction where an employee performs work for the University. Income tax will be withheld from employee pay and employees will be taxed according to the state and employment law and benefit provisions for the city and state designated as the primary work location.
- To ensure proper income tax withholdings whenever there is a change in primary work location, the employee must immediately update their address in KUL HR/Pay or work with KUMC Human Resources (HR) to update their work location within Workday. As established by the State of Kansas, adjustments to prior payments for state, county, or local tax withholdings are not allowed and will not be processed.
- Income tax withholding changes will be applied to the next available pay cycle after the KUL Payroll Office receives completed income tax withholding forms or after updates are completed within KUMC Workday.
- If an employee was taxed incorrectly, it is the employee’s personal responsibility to file their individual tax forms based on the income tax withholding reported on their State of Kansas tax form (i.e., W-2, 1042-S, W-2C).
- The employee is responsible for any penalties, interest, or fines they may be assessed for incorrect income tax withholding.
- Employees have a fiduciary responsibility to review their paystub and advise the University if they believe they are in error.
- At initial hire or when an employee’s primary work location changes outside of the State of Kansas, University units (supervisor or assigned staff) are responsible for educating the employee of their responsibility for completing and submitting all applicable income tax withholding forms to the KUL or KUMC Payroll Office.
- Units and employees are responsible for following the KUL Remote Work Policy or KUMC Remote Work Policy, as applicable, and securing approvals in advance before remote work can begin.
- If an audit finding determines a unit had knowledge of an employee working outside the State of Kansas and appropriate income tax withholding forms were not submitted, which resulted in incorrect tax remittance and fines to the University or State of Kansas, the unit may be financially liable.
Payroll Office Responsibilities
- The KUL and KUMC Payroll Offices are responsible for overseeing timely, accurate payroll calculation, including accurate income tax withholdings based upon income tax withholding forms received, on a predetermined schedule created by the State of Kansas.
- The KUL and KUMC Payroll Offices are responsible for communicating and educating employees and their supervisors regarding the requirements of correct income tax reporting requirements based on the primary work and home location.
This policy applies to income tax withholding for employees working within the United States. Primary work locations outside of the United States and/or the District of Colombia are not allowed unless it is approved official travel.
Failure to complete appropriate state income tax withholding forms will result in the employee receiving an inaccurate tax form for the calendar year (i.e., W-2, 1042-S, W-2C). Employees who misrepresent and/or fail to promptly update their primary work and home location may be subject to discipline, up to and including loss of remote work privileges. Employees with primary work locations outside of the State of Kansas may be subject to filing multiple state tax returns.
Employees would be liable for any penalties and interest levied against the employee by a respective tax authority for failure to complete a correct state (or other jurisdiction) income tax withholding form(s), lack of sufficient withholding, as well as failure to file required income tax return(s).
The employee’s unit may be held responsible for any fines, interest, or penalties levied by a taxation authority against the University or State of Kansas due to incorrect income tax withholding.
08/15/2022: Policy published in the Policy Library.