Dear Self-Directing Employees,

This is notification that a 2025 tax document may be required by no later than February 15^th. Pursuant to the IRS requirement noted below, if there have been any changes in your tax exemption status, you are required to provide this information.

Examples:

1. Change in Residence: If you lived with your employer full time, year-round, and had no other legal residence last year, but have since moved out, an updated tax form is necessary to reflect your new status.
2. New Living Arrangement: If you did not live with your employer last year but now reside with them full-time, year-round, and have no other legal residence, this change should be documented with updated tax forms to accurately capture your residency.
3. Change in Tax Exemption Status: If you claimed a tax exemption last year for a reason that is no longer applicable, updating the tax forms is essential to ensure accurate withholding and compliance with current tax regulations.

These updates help ensure that tax records remain accurate, reflecting any changes in personal circumstances that may impact filing status or withholding requirements.

IRS GUIDELINES:

Exemption From Withholding - https://www.irs.gov/taxtopics/tc753

If an employee qualifies, he or she may use Form W-4 or Form MW507 to tell you not to deduct any federal and/or state income tax from his or her wages. To qualify for this exempt status, the employee must have had no tax liability for the previous year and must expect to have no tax liability for the current year. A Form W-4 claiming exemption from withholding is valid for only the calendar year in which it is furnished to the employer. To continue to be exempt from withholding in the next year, an employee must provide an updated tax form claiming exempt status by February 15 of that year. If the employee doesn't provide an updated tax form, withhold tax as if he or she is single or married filing separately with no other entries in step 2, 3, and 4. If the employee provides a new Form W-4 claiming exemption from withholding on February 16 or later, you may apply it to future wages, but don't refund any taxes withheld while the exempt status wasn't in place.

This is included for informational purposes only and shall not be construed as tax or legal advice. We recommend you consult a tax professional for any questions or concerns.

WHAT IS REQUIRED?

If you have had changes in your tax exemption status, you must complete the following updated tax document(s) and submit to the FMCS via email at FMSAnnualExempt@thearcccr.org pursuant to the IRS requirement noted above.

• Form W-4
• Form MW507
• Special Tax Exemption Form (if #1 or #2 above apply)
• Special Tax Exemption Annual Notification Form and a copy of your legal identification (if Difficulty of Care Income Tax Exemption below applies)

If you already receive an exemption under the Difficulty of Care Income Tax Exclusion and wish to continue to apply, you do not need to take any action unless there has been a change in your full-time legal residency.

Note: If you are no longer working for the participant employer, please complete the Employee Termination/Inactivation Form, and then return to FMSEmployeeRelations@thearcccr.org.

Questions related to FMCS processing should be submitted via our Customer Service Ticket System. Thank you for your understanding and cooperation in ensuring regulatory compliance for all those paid to provide services.

This is included for informational purposes only and shall not be construed as tax or legal advice. We recommend you consult a tax professional for any questions or concerns.

Thank you,

Your Self-Directed Services Team at The Arc Central Chesapeake Region