Update as of January 6, 2023:
Please note that certain federal and state taxes were not finalized in time for the release of our first tax update. A second tax update will be issued in the near future that will update with the final tables and withholding amounts for 2023.
Federal Tax Changes
- Federal Income Tax Withholding - The 2023 withholding tax tables changed. As a result of changes to the W-4 form beginning with the 2020 calendar year, revised filing statuses are available, as well as the 2019 and older filing statuses for those employees that have not revised their existing withholding elections.
Review Payroll tax year 2020 W-4s for additional information.
- Social Security Wage Base - The 2023 social security wage base increased to $160,200.
State and Local Tax Changes
Important! Take note of setup instructions if you have employees in Colorado or Oregon.
- Arizona State Income Tax - Withholding percentage changed.
- California Disability Insurance - Withholding rate and taxable wage limit changed.
- California State Income Tax - Withholding tables and standard deduction changed.
- Colorado Family and Medical Leave Insurance - Colorado is implementing a new State-run Paid Family and Medical Leave Insurance program beginning January 1st, 2023. For more information, see Sage Knowledgebase article: Setting up Colorado Paid Family Leave (COPFL).
- Colorado State Income Tax - Withholding changes supporting form DR0004 and new filing status added. New filing statuses added for Married Filing Separate and Qualifying widow(er).
- Hawaii Temporary Disability Insurance - Annual wage and deduction rate changed.
- Iowa State Income Tax - Withholding tables and formula changes.
- Kentucky State Income Tax - Standard deduction and withholding rate changed.
- Maine State Income Tax - Withholding table and standard deduction changes.
- Massachusetts Paid Family Leave - Wage base and contribution rate changes.
- Missouri State Income Tax - Withholding table changed. Added new filing status: Married Filing Separate.
- Mississippi State Income Tax - Withholding table and standard deduction changes.
- Minnesota State Income Tax - Withholding table and standard deduction changes.
- Montana State Income Tax - Withholding table changes.
- Nebraska State Income Tax - Withholding allowance and table changes.
- New Jersey State Disability Insurance, Unemployment Insurance and Family Leave Insurance, State Income Tax - Taxable wage base and rate changes.
For more information, see Sage Knowledgebase article: New Jersey Family Leave (NJFLI) information for 2023.
- New Mexico State Income Tax - Withholding tables changed.
- New York Paid Family Leave - The weekly wage base limit and rate changed.
- New York State Income Tax - Withholding tables changed.
- New York Yonkers Local Income Tax - Withholding tables changed.
- Oregon Paid Leave - Oregon is implementing a new State-run Paid Leave program beginning January 1st, 2023. For more information, see Sage Knowledgebase article: Setting up Oregon Paid Family Leave (ORPFL).
- South Carolina State Income Tax - Personal Allowance, Standard Deduction and Withholding Tables changed.
For additional information, see Sage Knowledgebase article: January 1, 2023 Tax Update Bulletin.
Is your tax update applied?
You will receive this update automatically through your product. The version for this tax update is 20230101 for releases 2022 and 2023. Follow these steps to make sure that your tax update was applied:
- Open your Sage 50 company.
- Select Help > About Sage 50 Accounting.
- Confirm that the installed Tax Update version number matches the version number listed above.
- If your Installed Tax Update version number does not match:
- Select Services> Check for Updates > Check Now.
- If multiple updates appear, select the update(s) you want to install, then select Download.
- After the download is finished, exit Sage 50 and the update will begin.
Visit Sage.com/Resources for options, including links to Sage Year-end Center, Sage Knowledgebase, Sage City and Sage University, as well as Chat and Online Case submission.
You can also join us online at Sage Q&A Live to get quick answers to your questions. Enter your name and email address, click Join Webinar in Progress, and ask your question(s).