What percent do employers take away for taxes from an employee’s salary?

Technically, the employer takes nothing for taxes from an employee’s salary. The business owner withholds money and remits it to the government. In addition, the employer pays taxes based on how much the employer pays the employee. These are also remitted to the government.

Current Federal Tax Rates

Following is a chart that contains the taxable wage basis and tax rates for employers and employees. The 2019 maximum contributions and limits are given per employee.

FICA

On wages of $132,900 (2019): Employee Rate 6.20%.

On wages of $132.900 (2019): Employer Rate 6.20%.

Medicare

On ALL wages: Employee Rate 1.45%.

On ALL wages: Employer Rate 1.45%.

Above wages of $200,000.00.00 for an individual or $250,000.00.00 for joint filers there is an additional surcharge of 3.8% on the employee only.

Learn more about OASDI and SSI Program Rates & Limits, 2019 at SSA.gov.

Federal Unemployment

Employer Rate 0.6%.

After credit for paid SUI (state unemployment insurance).

On wages up to $7,000.00.00.

Learn more about FUTA rates.

State and Local Tax Rates

These vary depending on where you live and where you work.

Forty-three states have withholding for State Income Taxes.

All States charge the employer for unemployment taxes which pay for unemployment compensation.

Some Local taxing agencies withhold taxes and charge additional taxes to the employer.

There are also in some states taxes withheld for paying for Paid Family Leave. This is a growing trend and will probably continue to expand.

 

 

Interested in learning more about GetPayroll services? 

Are you shopping for new payroll services? Schedule a demo to see if GetPayroll is right for your business.

If you are a current GetPayroll customer (yay!), take a look at some of our new services that may help streamline your business operations.

 

Charles Read, CPA, USTCP, IRSAC
Charles Read, CPA, USTCP, IRSAC
President/CEO GetPayroll
Find me on LinkedIn

Comments and Suggestions

Don’t forget to leave us a comment below and tell us what you think. If you have any requests or suggestions, we’d love those too!

 

Leave a Reply

Your email address will not be published. Required fields are marked *