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INSTRUCTIONS

The Withholding Exemption Certificate (Form 499 R-4.1) is the document used by employees to

If you make contributions to the governmental pension or retirement plan, your

employer shall add 8.275% of your annual wages, to the optional standard deduction

notify his/her employer of the personal exemption, exemption for dependents and the allowance

to which you are entitled. Then, the employer will divide that total by $500.

based on deductions. These three factors are considered to determine the income tax to be

withheld from the employee’s wages.

If you opted for the retirement supplementary plan, your employer will add to the

optional standard deduction 5.775% of your monthly wages up to $550 and 8.275%

The employee shall complete the upper part of the form, indicating his/her name, social

of your monthly wages in excess of such amount (on an annual basis). Then, the

security number, postal and home address. If married, indicate your spouse’s name and

employer will divide that total by $500.

social security number.

On the other hand, if the governmental employee makes contributions through the

Also, you shall indicate with an “X” in Part A your option regarding the personal exemption that

you want to claim to determine the withholding from wages. Enter in Part B the number of

Retirement Savings Accounts Program, your employer must add 8.275%, 9%,

dependents claimed, and in Part C your choice with respect to the allowance based on deductions.

9.5%, or 10% (as your option) of your annual wages, to the optional standard

In Part D indicate if you elect the optional computation of tax in the case of married individuals

deduction to which you are entitled. Then, your employer will divide that total by

living together, filing a joint return and both working (optional computation of tax), as provided

$500.

in Section 1011(d) of the Puerto Rico Internal Revenue Code of 1994, as amended (Code).

The amount of the optional standard deduction allowable under the Code is:

PART A - PERSONAL EXEMPTION

Married living with spouse.......................................................................... $3,150

Indicate the personal exemption that your employer will consider to determine the income

Married living with spouse filing separated returns ...................................... $1,575

tax to be withheld.

Single or married not living with spouse ….................................................. $2,100

Head of household...................................................................................... $2,730

Line 1 - A single person, or married not living with spouse, may claim or not the personal

exemption. If you want to claim the complete personal exemption, mark the column titled

If the governmental employee does not make contributions to a governmental pension or

“Complete”. On the other hand, if you choose to claim no exemption at all, you may do so by

retirement plan, the number of allowances will be determined in the same way as in the

marking the column titled “None”. A single person or married not living with spouse, cannot divide

case of private business employees.

in two halves his/her personal exemption.

When both spouses receive wages subject to withholding and select the automatic method, they

Line 2 - Married couples are entitled to only one personal exemption, therefore, each spouse

must choose which of the spouses will select the optional standard deduction in order to determine

cannot claim the complete personal exemption. If you are a married person, and both spouses

the number of allowances. Nevertheless, if the married couple file a joint return and elected the

receive wages subject to withholding of income tax at source, both of you should agree on how

optional computation of tax, when determining the number of allowance based on deductions,

to claim the personal exemption and shall mark the corresponding column. If the married couple

each spouse will claim the standard deduction provided in Section 1023(aa)(1)(D) of the Code,

determine that only one of them will request the complete personal exemption, such spouse shall

that is, $1,575.

mark the column titled “Complete”. In such case, the other spouse shall mark the column titled

“None”. If you agreed with your spouse to divide the personal exemption in half, indicate so

Under the optional method, the number of allowances shall be determined as follows:

marking the column titled “Half”. If you do not want to claim the personal exemption, mark the

column titled “None”.

The total of itemized and additional deductions which you estimate you are entitled to claim

will be divided by $500. The estimate of the deductions shall be made in form “Determination

Line 3 - As in the case of a single person, a head of household has two alternatives: claim

of Allowance Based on Deductions under the Optional Method” (Form 499 R-4B), which

the complete personal exemption or claim no personal exemption at all.

shall be filed with your employer.

PART B - EXEMPTION FOR DEPENDENTS

Any fraction obtained as a result of this calculation in excess of 50%, shall be considered

as an additional allowance.

Indicate the number of dependents claimed. It shall be the same as the number that you will

claim as dependents in your income tax return.

In the case of a married person living with spouse, where both elect the optional method,

they are entitled to determine the allowances based on their combined salaries and deductions.

In the case of an employee who elected the optional computation of tax, the exemption

They may divide the total allowances based on complete allowances. However, any

for dependents will be 50% of the total amount provided in Section 1025 of the Code, since

allowance claimed by one spouse, cannot be claimed by the other spouse.

in such cases each spouse is entitled to claim only half of the exemption for dependents, as

Nevertheless, if the married couple file a joint return, elect the optional computation of

provided in Section 1011(d) of the Code.

tax, and use this optional method to determine the allowance based on deductions, the

number of allowances shall be determined by dividing the deductions among the spouses,

The Code provides that every employer who receives an exemption certificate from an

as provided by Section 1011(d) of the Code. That is, the itemized deductions shall be

employee in which the number of dependents claimed exceeds 8, shall submit a copy

attributed to each spouse on a 50% basis of the total, and the additional deductions shall be

of such certificate to the Secretary of the Treasury, as well as a copy of any written

allowed to the spouse to whom they individually correspond, to the extent and subject to the

statement received from the employee to support the information contained in the certificate.

provisions of subsection (bb) of Section 1023 of the Code.

PART C - ALLOWANCE BASED ON DEDUCTIONS

EMPLOYERS USlNG THE WAGE BRACKET METHOD

You are entitled to certain allowances based on deductions which your employer shall

consider to determine the amount of income tax to be withheld.

lf the employer uses the withholding Wage Bracket Method, the number of allowances

based on deductions under both the automatic or optional method, shall be determined by

The following two methods are provided in order to determine the number of allowances:

dividing the deductions by $2,500. For this purpose, only integer multiples of $2,500, and

(1) automatic method

not the resulting fractions, will be considered.

(2) optional method

PART D - OPTIONAL COMPUTATION OF TAX

Under the automatic method, the number of allowances is determined as follows:

For taxable years commencing after December 31, 2007, Section 1011(d) of the Code

(1) If you are a private business employee, your employer will divide the amount of the

provides an optional computation of tax in the case of married individuals living together,

optional standard deduction to which you are entitled by $500.

filing a joint return and both working. An employee who elects to determine his/her tax using

this computation, shall notify the same to his/her employer by checking the box provided in

(2) If you are a governmental employee, your employer shall consider the governmental

this part.

pension or retirement plan to which you make contributions, if any:

Instructions For Form 499 R-4.1 - The Withholding Exemption Certificate - Commonwealth Of Puerto Rico Department Of The Treasury

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