Available for Basic Payroll, Full Service Payroll
You will need to enter federal, and possibly state and/or local tax withholding information for each employee. Each employee should complete a federal Form W-4 (Employee's Withholding Certificate), plus any required state and/or local income tax withholding certificates. You will enter each employee's tax withholding information on their Tax Information page in Patriot Payroll.
How to Enter Employee Federal Withholding from Form W-4
Note: For 2026 and later, the IRS uses a redesigned Form W-4. See New W-4 Form: IRS Makes Minor Changes to 2026 Form, Plus One Big Beautiful Bill Act Updates for more info
Go to Payroll > Employees > Employee List > [Employee Name] > Taxes > Federal Taxes.
Click Edit.
Enter the information from the employee's Form W-4 into the corresponding fields:
Filing Status: Select the filing status from the drop-down as shown on the employee's Form W-4.
Multiple Jobs or Spouse Works: If the employee checked the box in Step 2 of their W-4, check this box in Patriot.
Claim Dependents: Enter the total dollar amount from Line 3 of the employee's W-4.
Other Income (not from jobs): Enter the amount from Line 4(a) of the employee's W-4. Enter $0 if the employee left this blank.
Deductions: Enter the amount from Line 4(b) of the employee's W-4. Enter $0 if the employee left this blank.
Extra Withholding: Enter the additional withholding amount from Line 4(c) of the employee's W-4. Enter $0 if the employee left this blank.
Exemption from Withholding: If the employee wrote "EXEMPT" below Line 4(c) of their W-4, select Exempt. Otherwise, keep this set to Not Exempt. Most employees are required to pay federal income tax. See What Does Tax Exempt Mean for more information.
Click Save.
Employees can update their own federal tax withholding by completing an electronic Form W-4 in the Patriot Employee Portal. When an employee submits a change, their federal tax withholding is automatically updated for the next payroll run. You will receive an email notification and can view the employee's W-4 history on their Taxes page. For more information, see Employee Federal Tax Updates in Patriot's Employee Portal.
How to Enter Employee State Tax Withholding
State and local tax fields vary by state. See the state-specific articles below if your employee's state is listed.
Go to Payroll > Employees > Employee List > [Employee Name] > Taxes > State.
Click Edit.
Enter the following information from the employee's state income tax withholding form:
State Filing Options: Select the filing option that matches what the employee entered on their state withholding form. Do not add extra spaces.
State Additional Withholding: Enter the dollar amount of additional withholding from the employee's state withholding form. The default is $0.
Exemption from Withholding: If the employee indicated they are exempt from state income tax, select Exempt. Otherwise, keep this set to Not Exempt. Most employees are required to pay state income tax.
Non-Resident Certificate: This field appears when the employee lives in a different state than the company's work location. Select Yes if the employee has a state non-resident certificate on file.
Click Save.
State-specific withholding guides:
Employee Local Tax Withholding
The Local Withholding section only appears for employees in states that have local income taxes.
Go to Payroll > Employees > Employee List > [Employee Name] > Taxes > Local Taxes.
Click Edit.
Select the correct local tax jurisdiction from the Local Tax drop-down. This drop-down is pre-filled with recommended settings based on the employee's home address. Only change the jurisdiction if you are certain the employee belongs to a different local tax jurisdiction.
Click Save.
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Example of recommended local tax setting
Additional notes on local tax settings:
If the employer has enabled the optional Courtesy Local Tax withholding for the employee's city of residence, the Local Tax field becomes required for all employees. This means Patriot will withhold and remit local taxes on the employee's behalf.
If the employee works from home, the Local Tax field is required for that employee.
Employee School District Withholding (OH and PA)
School district tax applies only in certain parts of Ohio and Pennsylvania. The School District Tax field displays a drop-down of all school districts available in the county of the employee's zip code.
Go to Payroll > Employees > Employee List > [Employee Name] > Taxes > Local Taxes.
Click Edit.
Select the school district where the employee resides. The school district drop-down is pre-filled with recommended settings indicated based on the employee's home address.
Only change the selection if you are certain the employee is in a different district. Select No School District Tax if school district tax does not apply to this employee.Click Save.
Advanced Employee Tax Settings
The advanced Employee Tax Settings is where you will mark employees exempt from taxes.
Go to Payroll > Employees > Employee List > [Employee Name] > Advanced Tax Settings > Edit.
For step-by-step instructions, see How to Make an Employee Exempt from Taxes.
Exempt From Taxes: In most cases, employees are required to pay income taxes, and employers are required to pay FUTA (Federal Unemployment Tax Act) and SUTA (State Unemployment Tax Act) on employees.
Mark a tax type as Exempt only if the employee is not legally obligated to pay Social Security, Medicare, or city income tax, or if the employer is not required to pay FUTA or SUTA for that employee.
Otherwise, leave each tax type set to Not Exempt.
When a tax type is marked Exempt, Patriot will not withhold that tax, however taxable wages will be reported on W-2s