Thoughts, Ideas, and Concepts by Sandra Parks

MORE ON PAYROLL TAXES

Payroll Taxes

Payroll Tax Rates
Social Security tax rate 6.20%
Medicare tax rate 1.45%
Total payroll taxes 7.65%

 

If an employee earns $1,000, the payroll taxes are:

Social Security tax $62.00
Medicare tax $14.50
Total payroll taxes $76.50

The employer sends the $76.50 to the federal government.
TIP:

There is a maximum annual amount of Social Security tax withheld per employee. Social Security taxes are not withheld on amounts over the earnings limit. For 2008, the earnings limit was $102,000, and the maximum Social Security tax was $6,324 ($102,000 X 6.2%). There is no limit on the amount of wages subject to Medicare tax.

 

For more informaton please visit http://saptaxes.net or contact me at 972.569.7938

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Comments on: "MORE ON PAYROLL TAXES" (2)

  1. Good information. The easiest thing to do is find a software that can automatically calculate this for you. Some software even comes with a guarantee that if it sets the wrong amounts, it will be liable to any problems with the IRS.

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