PAYROLL TAXES TO BE WITHHELD 1) Social Security (FICA) 2) Federal ...

2015 PAYROLL TAX FACT SHEET

REV: 3/2015

PAYROLL TAXES TO BE WITHHELD: 1) Social Security (FICA) The employee tax rate is 6.2%. The social security wage base limit is $118,500. The Medicare tax rate is 1.45%. There is no wage base limit for the Medicare tax. Tax on self-employees is 15.3% on the first $118,500 for Social Security and 2.9% on all net earnings for Medicare.

2) Federal Withholding Tax Per Tax tables in Publication 15, Employer's Tax Guide

3) PA Withholding Tax 3.07% of Gross Earnings

4) PA Unemployment (SUI) .07% of Gross Earnings

5) Local Withholding Tax Typically in this geographic area, 1% of Gross Earnings.

6) Local Services Tax Typically in this geographic area, $0, $10, or $52.

EMPLOYER'S TAXES

1) Social Security (FICA) The employer tax rate 6.2% on the first $118,500 of income for Social Security AND 1.45% for Medicare. There is no income limit for Medicare.

2) Federal Unemployment (FUTA tax ) 6.0% with credit of 5.4% for timely payments made to state unemployment compensation fund on the first $7,000 of each employee's wages.

3) PA Unemployment New employers - 3.6785% on the first $9,000 of each employee's wages. The rate is adjusted if you have claims. Construction employers' initial rate is 10.1947%.

FEDERAL DEPOSIT REQUIREMENTS

All new employers are deemed monthly depositors for Federal Withholding, Social Security, & Medicare. If your tax liability is less than $2,500 then the tax can be sent in with the quarterly report. The IRS will notify you each November whether you are a monthly or a semiweekly depositor for the coming calendar year. If you do not receive the notification, you must determine your own deposit

status. You determine your status as a monthly or semiweekly depositor at the beginning of the calendar year based on the tax you reported on your original Forms 941 for the four quarters in the lookback period.

Lookback Period - The lookback period consists of four quarters beginning July 1 of the second proceeding year and ending June 30 of the prior year. These four quarters are your lookback period even if you did not report any taxes for any of the quarters. For example, for 2015, the lookback period is July 1, 2013 through June 30, 2014.

Monthly Depositor Rule - If the total tax reported on Forms 941 for the four quarters in the lookback period is $50,000 or less, you are a monthly depositor for the current year. You must deposit employment taxes and taxes withheld on payments made during a calendar month by the 15th day of the following month.

Semiweekly Depositor Rule - If the total tax reported on Forms 941 for the four quarters in the lookback period is more than $50,000, you are a semiweekly depositor for the current year. If you are a semiweekly depositor, you must deposit on Wednesday and/or Friday depending on what day of the week you make payments as shown below:

*Notwithstanding these general rules, employers with $100,000 or more of accumulated liability during a monthly or semiweekly period are required to deposit the funds by the first banking day after the $100,000 threshold is reached. Also, employers accumulating deposits of less than $2,500 during the quarter may skip the deposits entirely and send full payment with their quarterly employment tax returns.

Payment Days/Deposit Periods

Wednesday, Thursday, and/or Friday

Saturday, Sunday, Monday and/or Tuesday

Deposit by Following Wednesday

Following Friday

Pennsylvania Employee Taxes to be Withheld:

Tax Item

Tax Rate (Percent of Gross Earnings) Form Used

Social Security Employee Rate - 6.2%

941

Tax (FICA)

SS Wage Base Limit - $118,500

W-2

Medicare Tax Rate - 1.45%

W-3

Federal Withholding Tax

Self-Employees SS (First $118,500) - 15.3%

Medicare - 2.9% on all earnings

Per Tax Tables in Publication 15, Employer's Tax 941

Guide

W-2

W-3

Frequency of Filing

941- Quarterly W-2 - Annually W-3 - Annually

Frequency of Deposits

941 - Monthly or Quarterly

Tax System Used

EFTPS System

941-Quarterly W-2 - Annually W-3 - Annually

941 - Monthly or EFTPS System Quarterly

PA Withholding 3.07% of Gross Earnings Tax

PA Unemployment

.07% of Gross Earnings

Local

Typically 1% of Gross Earnings

Withholding Tax

Local Services Tax

$10 - Can be Paid at Once $52 - Divided Out by Number of Payrolls

PA-501 PA-W3 PA-W2

501 ? Quarterly/ Monthly/ SemiMonthly

501- Quarterly/ Monthly/ SemiMonthly

E-Tides

PA-W3 - Quarterly

UC-2 UC-2A

PA-W2 - Annually

UC-2 - Quarterly UC-2A - Quarterly

UC-2 - Quarterly UC-2A - Quarterly

Unemployment Compensation Management System

Earned Income Tax (EIT) Quarterly Return

EIT - Quarterly W2-R - Annually

W2-R (Annual Reconciliation)

LST-1

Quarterly

EIT- Quarterly Quarterly

Berkheimer or

Keystone Collections Group

Berkheimer or

Keystone Collections Group

Glossary of Forms

Form 941 (Employer's Quarterly Federal Tax Return) - Use Form 941 to report withheld income taxes, social security tax, or Medicare tax from employee's paychecks or who must pay the employer's portion of social security or Medicare tax.

W-2 (Wage and Tax Statement) - The form that an employer must send to an employee and the IRS at the end of the year. The W-2 form reports an employee's annual wages and the amount of taxes withheld from his or her paycheck.

W-3 (Transmittal of Wage and Tax Statements) - The W-3 is used to reconcile the employer withholding activities for each quarter to the payments made. Tax Form W-3 is a transmittal which is forwarded to the Social Security Administration, showing total earnings, Medicare wages, Social Security wages, and withholding for all employees encompassing the entire year. Include copies of W-2s for all employees from whom taxes were withheld.

PA-501 (Employer Deposit Statement of Withholding Tax) - The PA-501 is a deposit statement used to make a payment and to insure it is properly applied to your employer withholding account. Deposits made quarterly (less than $300), monthly ($300-$1,000), or semi-monthly (greater than $1,000).

PA-W2 (Wage and Tax Statement) - The form that an employer must send to an employee and the PA Department of Revenue at the end of the year. The PAW2 form reports an employee's annual wages and the amount of taxes withheld from his or her paycheck.

PA-W3 (Transmittal of Wage and Tax Statements) - The PA-W3 is used to reconcile the employer withholding activities for each quarter to the payments made. Tax Form PA-W3 is a transmittal which is forwarded to the PA Department of Revenue, showing total earnings and withholding for all employees encompassing the entire year. Include copies of PA-W2s for all employees from whom taxes were withheld.

Form UC-2 - Employer's report for unemployment compensation. This form is used to report an employer's quarterly gross and taxable wages, and Unemployment Compensation contributions due.

Form UC-2A - Employer's quarterly report of wages paid to each employee. This form is used to list employees' social security numbers, names, gross wages earned, and credit weeks for a particular quarter.

Earned Income Tax Quarterly Return - This form is used to report employees' earnings and withheld earned income tax.

W2-R- Annual reconciliation of employee tax withholdings. Must be filed by the last day of February. Include copies of W-2s for all employees from whom taxes were withheld.

LST-1- The Local Services Tax is a local tax payable by all individuals who hold a job or profession within a taxing jurisdiction imposing the tax. It is due quarterly on a prorated basis determined by the number of pay periods for a year.

Employer's Taxes:

Tax Item

Social Security Tax (FICA)

Tax Rate (Percent of Gross Earnings)

Employee Rate - 6.2% SS Wage Base Limit - $118,500 Medicare Tax Rate - 1.45%

Form Used

941 W-2 W-3

Federal Unemployment Tax (FUTA)

Self-Employees SS (First $113,700)- 15.3% Medicare- 2.9% on all earnings

6.0% with credit of 5.4% for timely payments made to state unemployment compensation on the first $7,000 of each employee's wages.

Form 940

PA Unemployment

New employers - 3.6785% on the first $9,000 of each employee's wages. The rate is adjusted if you have claims. The initial rate for construction employers is 10.1947%.

UC-2 UC-2A

Frequency of Filing

941 - Quarterly W-2 - Annually W-3 - Annually

Frequency of Deposits

941- Monthly or Quarterly

Annually

Annually

UC-2 - Quarterly UC-2 - Quarterly UC-2A - Quarterly UC-2A - Quarterly

Tax System Used

EFTPS System

EFTPS System

Unemployment Compensation Management System

Glossary of Forms

Form 941 (Employer's Quarterly Federal Tax Return) - Use Form 941 to pay the employer's portion of social security or Medicare tax.

Form 940 (Employer's Annual Federal Unemployment Tax Return) - Use Form 940 to report your annual Federal Unemployment Tax Act (FUTA) tax. Together with state unemployment tax systems, the FUTA tax provides funds for paying unemployment compensation to workers who have lost their jobs. Most employers pay both a federal and a state unemployment tax. Only employers pay FUTA tax. Do not collect or deduct FUTA tax from your employees' wages.

Form UC-2- Employer's report for unemployment compensation. This form is used to report an employer's quarterly gross and taxable wages, and Unemployment Compensation contributions due.

Form UC-2A- Employer's quarterly report of wages paid to each employee. This form is used to list employees' social security numbers, names, gross wages earned, and credit weeks for a particular quarter.

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download