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Exempt your employee from Federal or State Withholding

by Intuit•84• Updated about 3 hours ago

Your employees can claim exempt on their Federal Form W-4 or state form if they meet certain requirements. Exempt means they won’t have any Federal or State Withholding taxes deducted from their paychecks. 

If your employee claims exempt, you should have a copy of the W-4 or state form for your records. Here’s how to set the Federal or State Withholding to exempt in QuickBooks. 

Select your product below. 

Note: Not sure which payroll service you have? Here's how to find your payroll service.

Set your employee’s Federal or State Withholding as exempt

If you use Intuit Enterprise Suite and have multiple companies, you can see all employees for all of your companies in the consolidated employee dashboard. From any of your companies:

  1. From the Company Switcher dropdown, select Consolidated view.
  2. Go to All Apps A bunch of numbers and letters on a tile wall., select Payroll, then select Employees.

From the employee dashboard, you can:

  • Search for a specific employee
  • Filter the view to see all employees for a specific company
  • Customize the info that shows on the dashboard
  • Make changes to employee info

For a better experience, open this article in QuickBooks Online. Launch side-by-side view Open this link in a new window.

  1. Go to All apps A bunch of numbers and letters on a tile wall., then Payroll, then Employees (Take me there).
  2. Select your employee.
  3. From Tax withholding, select Edit.
  4. Select the applicable Federal W-4 form if prompted.
  5. In the Federal Withholding Filing Status ▼ dropdown, select Exempt (if applicable).
  6. In the State Withholding Filing Status ▼ dropdown, select Exempt (if applicable). 
  7. When finished, select Save.
  1. Select Employees, and then Employee Center.
  2. Select the employee you want to exempt. 
  3. Select Payroll Info, and then select Taxes.
  4. From the Federal tab, on the W-4 Form ▼ dropdown, select the applicable form.
  5. In the Filing Status dropdown▼, select Exempt. 
  6. Select the State tab, and in the Filing Status dropdown▼, select Exempt.
  7. Select OK to save.
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