Incorrect withholding exemption certificate; notification of department; determination of number of exemptions to be allowed; appeal by employee

# (A)

# (1)

If an employer receives a withholding exemption certificate from an employee claiming ten or more withholding exemptions or he believes an employee's withholding exemption certificate is incorrect, the employer shall furnish a copy of the certificate to the department within thirty days after it is received.

# (2)

Until otherwise informed by the department the employer shall withhold on the basis of the claimed exemptions.

# (B)

# (1)

If an employer furnishes a copy of an employee's withholding exemption certificate to the department, or if the department for any other reason believes an employee's withholding exemption certificate may be incorrect, the department may request that the employee submit written verification of the statements on the certificate within thirty days.

# (2)

If the department determines, upon review, the information is incorrect, it shall inform the employee that the exemption certificate is invalid and of the number of exemptions allowed. If the employee does not provide adequate verification to support the exemptions claimed on the withholding certificate, the department shall allow only one exemption.

# (C)

# (1)

The determination by the department may be appealed as provided under the Revenue Procedures Act within thirty days after the department's decision is rendered. Final review of the appeal includes the final decision of the Administrative Law Court or court if the matter was heard by the Administrative Law Court or appealed to a court.

# (2)

If the employee does not appeal the department's determination, the department shall notify the employer of the number of exemptions to allow in computing the employee's withholding. The correct number of exemptions, as determined by the department, Administrative Law Court, or court, must begin on the first payroll period ending on or after the date the employer receives notification.