Name that type of Employee!
Terry is a salaried-exempt employee. what does that mean?
Terry earns a high enough salary that does not qualify them for overtime.
True/False: Employees must pay their own taxes throughout the year?
False, Employer's pay the employee's taxes on their behalf throughout the year.
True/False: Employers take money out of their employee's wages to pay their portion of their tax liabilities?
False: Employers pay their tax liabilities on top of their employee's gross wages.
What are the four most common types of pay schedules?
1. Weekly
2. Bi-weekly
3. Semi-monthly
4. Monthly
What defines a Contractor?
They can work wherever
Can work for multiple companies
Usually trains on their own
Uses their own tolls and resources
Controls their own method of work
If often (but not always) paid by the project or on a flat-fee basis.
Samantha was paid $2,980.00 in gross wages for one pay period. How much will she pay in Social Security taxes?
$184.76
What are the rates for both the employer's portion of Social Security and Medicare?
Social Security:6.2%
Medicare: 1.45%
How many time per year would an employee be paid on a bi-weekly pay schedule?
26 times per year
What defines an Employee?
Works at specific times and places
Generally works for one employer
May receive training
Uses ER's tools or other work-related resources
Does work that in integral to the business
Subject to a large degree of control by the employer
Generally paid a salary or on an hourly basis
What is the additional rate that is applied to an employee once they have surpassed the $200,000.00 wage base limit?
0.9%
True/False: Employers must pay taxes for a 1099 contractor?
False
Does a pay schedule that is non-arrears best fit an hourly or salaried employee?
Salaried Employee
What is the name of the form that is filed for a contractor each year?
Form 1099-MISC
What is Publication does Gusto use to calculate FIT?
Publication 15-A
True/False: The Check date determines where wages and taxes are reported?
True: The check date determines where an employee's wages and taxes are reported.
Ex: Pay Period is December 15-31 of 2018 and the check date is January 5, 2019. The wages for that pay period will be reported in the next year since the check date was on 1/5/19
How many workable hours are recognized by the IRS for an entire calendar year?
2080 hours
40-hour workweek, 52 weeks in a year
40X52=2,080 hours
What is the name of the form that is filed for employees each year that shows their wages and taxes paid for that calendar year?
W2
Mary made $43,543.78. How much did she pay in Social Security and Medicare?
Social Security: $2,699.71
Medicare: $631.38
What is the rate the IRS recommends that you withhold for FIT on all bonuses?
22%
What is the difference between arrears vs non-arrears?
Arrears: There is a gap between the pay period and the date the employee is paid
Non-Arrears: There is no gap between the pay period and the date when an employee receives payment.