Withholding Exemption for Students and Part-Time Employees

If you have an employee who expects to earn $9,350 or less in income during 2010, you are not required to withhold Maryland state and local income tax. Students and other part-time workers affected by this situation may claim an exemption from withholding, using Maryland Form MW507, Employee's Maryland Withholding Exemption Certificate. You should keep the completed MW507 certificate with your records.

Many high school and college counselors have partially completed MW507 forms that eligible employees can use to claim the withholding exemption with their employer.

You are responsible for sending a copy of an MW507 certificate to the Compliance Division under the following circumstances:

• You have any reason to believe the certificate is incorrect.
• The employee claims more than 10 exemptions.
• The employee claims "exempt" as a result of having no tax liability for the preceding tax year, expects to incur no liability this year, and the wages are expected to exceed $200 a week (a new exemption certificate must be re-filed each year by the 15th day of February for employees whose income tax liability is determined on a calendar basis or by the 15th day of the second month following the last day of the employee's tax year).
• The employee claims exemptions from withholding on the basis of residence in a reciprocal state.

Mail completed forms to:

Comptroller of Maryland
Compliance Division, Compliance Programs Section
301 W. Preston Street
Baltimore, Maryland 21201