Payroll and tax Flashcards
How do you calculate gross salary?
Salary gross per pay period = Total salary / number of pay periods per year
How do you calculate wage (hourly) gross pay?
Quantity of hours worked * wage per hour
How do you calculate overtime rates?
Overtime rate (40 + hours in a week) = 1.5 times the wage
What act established overtime wages?
Fair labor act
What is net pay, or “take home” pay?
Gross pay - deductions
What is the common name for the Employee’s withholding allowance certificate? And what is it?
W4, it accounts for how many allowances employees can claim
*Four = employer
What is the deadline to have your taxes filed?
April 15th
What is a tax return vs owing taxes?
A tax return occurs if too much money was withheld from an employee’s pay and a owing money is when not enough was withheld
What are the 5 levels of deductions that happen from an employees total earnings?
- Federal taxes (individual and FICA)
- State income tax
- Local income tax (city or municipality)
- Public welfare tax
- Employee requested deductions
The amount that employers must withhold from an employees pay for an income period
Federal income tax withholding
What is the FICA tax?
Federal Insurance Contributions Act: an act that requires most employers and employees to pay taxes to support federal social security program.
-Social security and medicare
Wage and tax statement; a report furnished by the employer for each employee indicating gross earnings and deductions
* ___ = you (employee)
W2
*two
What are the social security and medicare tax rates?
Social security - 6.2% up to $128,400
Medicare: 1.45% with no limit
What is the FUTA?
The Federal Unemployment Tax Act. A federal act imposed upon employers for financing and administrative costs of the federal and state unemployment compensation programs
-6% on first $7,000 of wages
What is SUTA?
State unemployment tax act
-0.10% to 5.70% on the first $44,000 in wages
