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Tax Changes Implemented Pay Period 2026-08: LA, MD, and Localities in PA

DATE: Thursday, April 9, 2026

Please share this information with all impacted employees.

The following tax changes were implemented in Pay Period 2026-08. As a result, employees may see a change in their current tax withholdings. Please note that these tax changes are not applied retroactively and reconciliation may be needed when impacted employees file their tax returns.

State Taxes 

Louisiana State Income Tax Withholding:

  • The state income tax withholding formula has changed effective January 1, 2026.
  • The total number of exemptions claimed, including personal and dependent exemptions, are added together.
    • The standard deduction is calculated on this total to the maximum allowed based on marital status.
  • Datamart Query: Tax State = 22
     

Maryland State Income Tax Withholding:

  • The state income tax withholding formula has changed effective January 1, 2026.
  • The standard deduction has increased from $3,350 to $3,400 annually.
  • Flat tax rate:
    • Allegany County has changed from 3.03% to 3.2%.
    • Kent County has changed from 3.2% to 3.3%.
  • Datamart Query: Tax State = 24

Local Taxes

Pennsylvania Local Income Tax Withholding:

  • Wilkes Barre Township
    • The resident earned income tax rate has changed from 1.25% to 1.5%.
    • Datamart Query: Tax State = 42, City Code =9353

You may execute Datamart queries to identify employees in affected state taxing areas. For Combined File Ad-Hoc query/analysis of applicable states, add STE Tax State 1 = (Tax State code listed above) or STE Tax State 2 = (Tax State code listed above) to the filter or prompt lines. Another option is the shared Datamart report titled "State Tax Code Report." For local queries, add the Tax State and/or City Code to the prompt lines (Occurrences – Other PE Pay).

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