Employers are required to withhold and pay personal income taxes on wages, salaries, bonuses, commissions, and other similar income paid to employees. Complete Form W-4 so that your employer can withhold the correct federal income tax from your pay.Give Form W-4 to your employer. Hey Buddy Buck here! Box 17: State income tax This is the total state income tax withheld from your pay during the year. Complete the Business Licensing Wizard to receive a list of agencies to contact, additional endorsements and helpful tips about your business license. Ordering tax forms, instructions, and publications. Continued on next page. Most states calculate their tax similarly to federal methods. New York State Tax b.