Employees who earn regular wages in the United States generally see several different types of taxes withheld from their paychecks, though the exact amounts vary from one worker to the next. As HowStuffWorks explains, the total amount paid per check is the sum of these different obligations. Each paycheck is subject to federal payroll taxes, Social Security withholding, Medicare tax and a federal unemployment tax.Continue Reading
Employers in the United States are required by law to withhold federal payroll taxes from the checks of their employees. The amount to be withheld, deposited and reported to the IRS is set by the answers the employee gave to the questions on IRS form W-4 at hiring. Additionally, according to HowStuffWorks, the employer is required to deduct 6.2 percent of the employees' wages to fund Social Security as well as to contribute a matching amount. Medicare and federal unemployment benefits are funded by a withholding of 1.45 percent each, along with matching contributions from the employer.
In addition to federal taxes, employees are sometimes required to pay state taxes that are generally withheld in the same way as federal taxes. These taxes vary by state, with some states charging no income taxes at all, according to CNN Money.Learn more about Taxes
California withholding and tax table rates provide the applicable taxes employers must deduct from employees' paychecks, according to the California Employment Development Department. California applies a personal income tax on people who work in the state, and the state mandates state disability insurance withholding, notes Zacks Investment Research. Employers make the necessary deductions from paychecks and submit the payments to the California Employment Development Department, the state agency responsible for payroll tax policies.Full Answer >
The Old-Age, Survivors, and Disability Insurance program is a Social Security tax deducted from paychecks. The Federal Insurance Act allows OASDI to combine with the Medicare Hospital Insurance program and form the FICA tax, according to USA.gov.Full Answer >
Typical paycheck deductions include the employee's portion of Social Security and Medicare under the Federal Insurance Contributions Act, known as FICA; federal income tax withholding, based on the employee's W-4 form; and state and local income taxes as applicable, notes SurePayroll.com. Other possible deductions include the employee's portion of medical, dental, vision, life and disability insurance premiums and payments to 401K, retirement or flexible spending accounts. Deductions for union dues and charitable donations are also possible, according to U.S. Trust.Full Answer >
Employers use withholding tax tables to calculate the amount they need to take out of an employee's paycheck for taxes, according to the Internal Revenue Service. Employers make these calculations using either the percentage method or the wage bracket method with information listed on an employee's W-4 form.Full Answer >