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Old 04-24-2014, 01:13 PM
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employee tax withholding

Hi guys,

I finally got my first employee and I know that I need to withhold from their paycheck federal income tax, social security, and medicare (federal withholding not state).

Where do I pay the government what I withhold? How often do I pay them? Is it monthly, bi-weekly?...

Thanks guys so much!



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Old 04-24-2014, 02:33 PM
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Originally Posted by Jwaldmann View Post
Hi guys,

#1;I finally got my first employee and I know that I need to withhold from their paycheck federal income tax, social security, and medicare (federal withholding not state).



#2;Where do I pay the government what I withhold?


#3; How often do I pay them? Is it monthly, bi-weekly?...

Thanks guys so much!
#1;Correct; also FUTA tax or other local/city taxes if they impose those taxes on EE.so you need to withhold state withholding taxes(SUTA other state taxes)/fed w/d taxes(incl fica taxes/futa taxes) from their paycheck

#2; you need to pay state withholding tax to your state Dept of Rev(DOR) or franchise tax board for CA. however, you must pay federal tax withheld/fica tax/futa tax from his paycheck to the IRS.you, as an ER, must report wages, tips and other compensation paid to your EE by filing the required form(s) to the IRS. You must also report on the taxes you deposit. By the end of feb 28 2015(Mar 31 2015 if you send it electronically), you need to send a W2 to SSA and DOR of your state. So you must pay taxes to DOR of your state and IRS and send a W2 to SSA.


#3; The deposit schedule you must use is based on the total tax liability you reported on Form 941 during a lookback period. I do not think you are a semi (bi)weekly depositor as you are a new ER . I guess in your case, as a new ER, monthly basis; you need to deposit your state w/d taxes to your state dept of Rev monthly basis as a new ER. You also need to deposit employment taxes(SUTA/other state level taxes) to yur state dept of rev quarterly basis(mostly); Under the monthly deposit schedule, you need to deposit state w/d taxes on payments made during a month by the 15th day of the following month; you can check it with your state dept of rev.You also need to file your state employment tax form(s) with your DOR quarterly basis; you usually need to deposit other state level employment taxes,i.e., suta tax other taxes to DOR quarterly basis(mostly).
IRS:As a monthly depositor, you must deposit your federal income tax withheld and both the employer and employee social security and Medicare taxes. Monthly deposits must be made by the 15th day of the following month. So your payroll deposit for March must be made by April 15.Employers who deposit monthly should only report their deposits quarterly or annually by filing Form 941 or Form 944(annually)/940(annually).You need to deposit FUTA tax by the last day of the first month that follows the end of the quarter. If the due date for making your deposit falls on a Saturday, Sunday, or legal holiday, you may make your deposit on the next business day.If your liability for the fourth quarter (plus any undeposited amount from any earlier quarter) is over $500, deposit the entire amount by the due date of Form 940 (January 31). If it is $500 or less, you can pay the tax with your 2014 Form 940 by January 31.

Note; if your payroll tax obligation is less than $2.5k in a quarter, you can deposit these taxes with a "timely filed return, quarterly basis even if you are a new ER. If you are a new employer and you did not have employees during this "look back" period, you are a monthly depositor. If your total payroll taxes for the "look back period" were $50k or less, you are a monthly depositor. If your total payroll taxes for the "look back period" were more than $50k, you make deposits on the semi-weekly schedule.



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