Payroll taxes are the taxes which are withheld from the paycheck of an employee by the employer. These taxes are local, state, and federal taxes which are withheld as per the law. They consist of income taxes, Medicare taxes and Social Security taxes. The Medicare Tax and Social Security will be matched by the employer.
Each employee has to fill out and sign the W-4 form as the taxes are calculated based on this form. The employee will declare the amount being withheld accordingly. The refund for the taxpayer is also calculated through this form. The IRS will provide the income tax calculation, which is based on these declarations made by the employees. The employer uses a formula to calculate the state tax for each employee. This formula is provided by the state tax board and the employer needs to abide by the same. It is important that the employer is aware of the current tax rates so as to calculate the payroll tax accurately. It is the responsibility of the employer to make the payment of the taxes within the due date.
Payroll tax calculator
To help one calculate the tax, it is advisable to use the payroll tax calculator. It is a business calculator which will help make the right decision. Every business owner can use the calculator to determine the taxes. The payroll calculator helps determine the take-home pay and is suitable for individual use as well as business use. It also helps calculate 401K and determine the net pay for the employees. The calculator is easy to use and runs on the latest technology making it easier for both the employer and the employee to understand the calculations.
The payroll tax calculator saves the time and effort it takes to calculate the taxes before the employer withholds the same from the salary of the employees. The calculator uses the specific formula assigned by the state tax board and calculates the taxes accordingly. One may only fill in the details about the employee, their salary, and bonuses. The calculator uses the rate and calculates the taxes within a few minutes. It also uses a supplemental tax rate to calculate the withholdings on a special wage payment, like the bonus. If there is no supplemental rate, one may use the aggregate bonus calculator for the same.