Question

Which payroll taxes are the employee’s responsibility and which are the employer’s responsibility?

Short answer

The payroll taxes for employees are: -

• Employee FICA Taxes
• Employee Income Tax
• Employee Voluntary Deductions
• Employee Payroll Recording

The payroll taxes for employers are: -

• Employer FICA Tax
• Federal and State Unemployment Taxes
• Recording Employer Payroll Taxes

Step-by-step solution

Payroll taxes

Payroll taxes are the taxes imposed on employers or employeesand are measured as a percentage of the salaries that the employers pay their staff. Payroll taxes generally fall into two categories:

1. Deductions from an employee’s wages
2. Taxes paid by the employer based on the employee wages

Employee payroll taxes

Payroll deductions, commonly called withholdings, are amounts withheld from an employee’s gross pay, either required or voluntary. Required deductions result from laws and include income taxes and Social Security taxes. Voluntary deductions, at an employee’s option, include pension and health contributions, health and life insurance premiums, union dues, and charitable giving. These are:

• Employee FICA Taxes
• Employee Income Tax
• Employee Voluntary Deductions
• Employee Payroll Recording

Employer payroll taxes

Employers must pay payroll taxes in addition to those required of employees. Employer taxes include FICA and unemployment taxes. These includes:

• Employer FICA Tax
• Federal and State Unemployment Taxes
• Recording Employer Payroll Taxes