Oklahoma State Tax Routine (OKTX)

The Oklahoma (OKTX) State Tax Special Routine processing utilizes the following steps:

Line 1

Multiply the employee’s gross wages for the current payroll period by the number of payroll periods in a year to obtain their Annualized Gross Income (GI).

Line 2

Determine the employee’s Withholding Allowance Amount*.

Line 3

Determine Net Taxable Income by subtracting Line 2 from Line 1.

Line 4

Using the Marginal Tax Rates (DEDX) entries for the Oklahoma State Tax deduction, compute tax on the Taxable Amount (Line 3).

Line 5

Divide the amount on Line 4 by the number of payroll periods in a year to determine the employee’s Oklahoma Withholding Tax for the pay period.

*Determine the Withholding Allowance Amount

  1. Take the Annual Exemption Amount on the Tax Parameters (TAXP) entry for the employee’s State Tax Deduction and Marital Status multiplied by the number of State Tax Allowances on the employee’s Employee Tax Parameter (TAX).

Data Setup Considerations

Sites need to ensure that they have implemented the following Business Process/Data Setup Changes at their site prior to Oklahoma State Tax Routine.

  1. The Tax Parameters (TAXP) setup for Oklahoma.

  1. The Annual Exemption Amount is the Withholding Allowance Amount.

  1. The Employee Tax Parameter (TAX) enrollment.

  1. The State Tax Allowance field captures the employee’s claim for the number of exemptions.

Note: The point 2 functions if the MULTI_STATE_TAX parameter is set to N as part of the Application Parameter (APPCTRL) page, if the parameter is set to Y, then the system functions as per point 3.

  1. Employee enrolled in the State Tax Enrollment (TAXS) (Note: this only applies to employees enrolled in the State Tax Class (TAXCS) that includes an Oklahoma’s State Tax Deduction).

  2. The State Tax Allowance field captures the employee’s claim for the number of exemptions.