What percent should an employer withhold for Virginia withholding on a separate supplemental payment for vacation?

The correct percentage for Virginia withholding on a separate supplemental payment for vacation is 5.75%. This rate is in line with Virginia's tax withholding guidelines for supplemental wages, which include bonuses and other supplemental payments.

Typically, Virginia applies a flat withholding rate of 5.75% for these types of payments, making it straightforward for employers to calculate the required withholding for vacation payouts. This allows for consistency and transparency in the withholding process across different types of payments that employees might receive.

Employers must adhere to this specific withholding rate to ensure compliance with state tax regulations, which helps prevent potential issues with under-withholding or over-withholding for employees.

Understanding this withholding rate is essential for proper payroll management and helps employees anticipate the tax implications of their vacation payouts.