Curtis just received a raise at work increasing his salary by $8,500. He knows that an increase in salary will increase the amount of federal income taxes withheld from his paycheck. Which of the following statement best describes the effect his raise will have on state income tax withholdings? a. State income tax is unrelated to federal, he will see no change in his state withholding. b. Since he is having more withheld for federal, he will have less withheld for state so that he pays the same amount in the end. c. State income tax is usually a set percentage of federal income tax. With an increase in federal he will see an increase in state withholding. d. Since he is making more money, the state government will take advantage of his raise and charge him more income tax. His state withholding will increase.

Answer

Option c

Q: What will happen to the state income tax withholdings when Curtis receives a raise and his federal income tax withholding increases? A: It is uncertain and requires further analysis.
Q: Which of the given options is the most accurate description of the effect on state income tax withholdings after Curtis received a raise? A: Option c. State income tax is usually a set percentage of federal income tax. With an increase in federal he will see an increase in state withholding.