Payroll taxes - sustany/dvg GitHub Wiki

Payroll tax is tax paid by an employer for each employee and deposited into an IRS account.� The Internal Revenue Code imposes two forms of employment tax obligations on an employer that both fall under payroll tax.� First, the employer is required to pay unemployment insurance taxes, and to make contributions to its employees� social security and Medicare benefits pursuant to the Federal Insurance Contributions Act (�FICA�- see below).� Tax on the employer is calculated according to the number and wages of its employees.� Second, the employer is required to withhold from the employee�s paycheck a) the employee liability for federal income tax based on the employees� wages, and b) employees� own FICA contributions --Social Security and Medicare.� Certain types of wages and compensation are not subject to social security and Medicare taxes.� Payroll taxes also include state employer and employee income tax liability. � Other payroll taxes, such as municipal income tax, vary from jurisdiction to jurisdiction.��

Federal Insurance Contributions Act (FICA) under 26 U.S.C. �3128 (2011), ), is the statutory authority for the payroll deduction of� federal tax payments from� employers and employees to support Social Security and Medicare.� This provides for a federal system of old-age, survivors, disability, and hospital insurance.� The old-age, survivors, and disability insurance part is financed by the social security tax.� The hospital insurance part is financed by the Medicare tax.� Each of these taxes is reported separately.�