All Things Payroll Taxes
The total amount of tax debt owed by an individual or business to a governing entity such as the IRS is known as a ___ ___ (2 words)
Tax Liability
Bonuses, commissions, and tips are also known as ___ ___ (2 words).
Supplemental wages
Sandra has earned a total of $5,500.00 this year. How much has she paid in Social Security?
$341.00
Must answer both questions correctly:
1. What is the rate of Social Security?
2. What is the rate of Medicare?
1. 6.2% (Total rate: 12.4%)
2. 1.45% (Total rate: 2.9%)
The IRS identifies companies using their assigned nine-digit number. What is that number called?
EIN, FEIN, or Taxpayer ID
The portion of the employee's gross wages that are taxable is known as the ___ ___ (2 words)
Subject Wages
Calculate Miguel's wages:
Miguel earns $15.00 an hour and his employer pays him on a weekly pay period. For the most recent pay period, Miguel worked 40 regular hours and 12 hours of overtime, how much did Miguel earn?
$870.00
Calculation:
$15.00 x 40 hours = $600.00
$22.50 x 12 hours (OT) = $270.00
$600.00 + $270.00 = $870.00
Geraldo earned $22,000.00 for all of 2024. How much Medicare tax did he pay?
$319.00
True or false: Companies that operate in the same state and pay SUI may use different SUI rates.
True
Employers are given specific rates from the state to withhold and pay SUI, however, all employer's in the same state have the same taxable wage base for SUI
A pay schedule is made up of the ___ and the ___.
Pay Period, Pay date
The total amount of wages that are subject to taxes in a given time period is known as the ___ ___ ___ (3 words)
Taxable Wage Base
supplemental withholding rate
Jenni, an employee for Becca's Cheese Curdz earned $250,000.00 for all of 2023. How much total Medicare did she pay for the year?
$4,075.00
Regular Medicare: $3,625.00
Additional Medicare: $450.00
Calculation:
Regular Medicare: $250,000.00 x 1.45% = $3,625.00
Additional Medicare: $50,000.00 x 0.9% = $450.00
Total Medicare amount: $3,625.00 + $450.00 = $4,075.00
6%
Note: Employers receive a 5.4% discount on this tax IF they are also paying state unemployment insurance and they have made timely payments.
The Employee's ____ ____ determines which state payroll taxes employees and employers are liable to pay.
work address
What is the taxable wage base for Social Security for 2026?
$184,500
$2,884.62
Calculation:
$75,000.00 / 26 = 2,884.615 (round up)
Deion made $170,000.00 for all of 2024. How much Social Security did his employer pay?
$10,453.20
Calculation: $168,600 x 6.2%
Don't forget the wage base!!!
Becca, an admin for Becca's Cheese Curds is creating a pay schedule for her employees who are all paid by the hour. It would be most beneficial for her to set up her pay schedule in a ___ status.
arrears
Must answer each part correctly:
1. There are a total of ____ sections on the Form W4.
2. Sections __, __, and __ are optional sections employees can fill out.
1. 5 Total Sections
2. Sections 2, 3, and 4 are optional