Payroll Taxes – FICA FUTA
Federal Tax Course – Lesson 17
| Introduction | 1701 |
| FICA Tax | |
| Purpose of the Tax – Tax Rates | 1702 |
| Maximum Wages Subject to the FICA Tax | 1703 |
| Who is Covered | 1704 |
| Domestic Employees | 1704A |
| Employees vs. Independent Contractors | 1705 |
| Wages Subject to Social Security | 1706 |
| Special Rules for Tips | 1707 |
| Employer’s Identification Number | 1708 |
| Remittance of the Payroll Taxes | 1709 |
| Employer’s Quarterly Return on Form 941 | 1710 |
| FUTA Tax | |
| Purpose of the Tax – Tax Rates | 1711 |
| Who is Subject to the Federal Unemployment Tax | 1712 |
| Wages Subject to Federal Unemployment Tax | 1713 |
| Return and Payment of the Tax | 1714 |
| Withholding Statements | 1715 |
| Transmittal Form W-3 | 1716 |
| Records of Wage Payments | 1717 |
| Information Returns | 1718 |
| Special Reporting Requirements for Restaurants and Beverage Establishments | 1719 |
| How Long Returns and Records Have to be Kept | 1720 |
| Special Rules for Various Types of Services and Payments | 1721 |
Federal Payroll Taxes FICA FUTA:
In addition to the income tax withholding provisions discussed in Assignment 16, employers are subject to two Federal payroll taxes:
- Federal Insurance Contributions Act (FICA) taxes and
- Federal Unemployment Insurance (FUTA) tax.
While income tax withholding does not really represent a tax on employers or employees – it merely requires the employer to withhold part of the employee’s salary for the payment of his income tax – FICA and FUTA taxes constitute a special group of employment taxes, paid either partially (in the case of FICA tax) or completely (in the case of FUTA tax) by the employer. Although both FICA and FUTA taxes are under the Social Security program, the FICA tax is the one frequently referred to as “Social Security” tax.
More in the Federal Tax Course