What is Personal Income Tax (PIT) and how is it withheld from payroll?
Personal Income Tax (PIT) is the tax individuals pay on their income, including wages, salary, and other earnings. In U.S. payroll context, PIT typically refers to state income tax withholding (the federal equivalent is just called federal income tax withholding). Forty-one states impose PIT; nine do not (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming). Employers withhold PIT each pay period based on the employee's state W-4 equivalent and remit to the state tax agency.
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