Roseville Employment Tax Accountant
Cook CPA Group
Employers are required to pay certain taxes on the income they make. This includes federal income tax, Social Security and Medicare taxes, the Federal Unemployment Tax (FUTA), and, if applicable, self-employment taxes. The IRS, however, places certain requirements on how often these taxes are paid, the services that they can be paid through, and what forms they must be reported on. It can be overwhelming for employers to take in all of this information, but it doesn’t have to be with the help of a Roseville employment tax accountant.
Employers can use the help of a certified accountant to pay all of their employment taxes to the IRS so that they can focus on more pressing business matters. Get in touch with an accountant from Cook CPA Group soon to learn more about how you can use their services to pay your employment taxes with promptness and accuracy. Call (916) 432-2218 for more information about setting up a free consultation.
Types of Employment Taxes
There are a few different types of federal taxes that employers must pay. Any Roseville employer who would like to learn more about their taxes can consult Publication 15, the Employer’s Tax Guide. The taxes that must be paid to the IRS by employers are:
- Federal income tax – This tax is generally withheld from employees’ wages and is paid to the IRS by employers. The way that an employer deposits their withholdings depends on the type of business they have and the amount that they would like to withhold, as determined by the information that the employee entered on their W-4 form. Employers should note that the amount for one withholding allowance in 2019 is $4,200.
- Social Security and Medicare taxes – Employers must withhold a part of employees’ wages for Social Security and Medicare and must pay a matching amount themselves. Employers can figure out how much tax to withhold by using Form W-4. The employee tax rate for Social Security in 2016 is 6.2%; the wage base limit for Social Security is $118,500. The tax for Medicare is 1.45%, with no such limit. Social Security and Medicare taxes are also known as FICA taxes, since they are mandated by the Federal Insurance Contributions Act.
- Additional Medicare taxes – Employers are responsible for withholding the Additional Medicare Tax from their employees’ wages. In 2019, the Additional Medicare Tax rate is 0.9% on not only an employee’s wages but an employee’s compensation that exceeds a threshold determined by their filing status. Employers must begin withholding the Additional Medicare Tax during the first pay period that exceeds the threshold. Employers do not match employee withholdings for the Additional Medicare Tax.
- Federal Unemployment Tax (FUTA) – Employers alone pay FUTA; it is not withheld from employees’ paychecks. Deposits made for this tax are required for every quarter in which the amount of the tax due exceeds $500. FUTA payments must be deposited by the end of the month following the end of the quarter in which the amount due exceeds $500.
- Self-employment tax – This tax is paid only by individuals who work for themselves, either as small business owners or freelancers. It is very similar in nature to the Social Security and Medicare taxes that are paid by employers.
Depositing and Reporting Employment Taxes in Roseville, CA
Employers are required to pay their taxes through the Electronic Federal Tax Payment System (EFTPS), a free service provided by the Department of Treasury. If a Roseville business does not want to pay their employment taxes using the EFTPS, they can instead arrange to have a tax professional, payroll service, financial institution, or other qualified third party make the deposits on their behalf.
Before each calendar year starts, employers must choose a deposit schedule to follow — either monthly or semi-weekly. If a monthly deposit schedule is chosen, employment taxes can be made for one month by the 15th day of the month that follows. If the semi-weekly deposit schedule is chosen, employment taxes can be made in the week following the date of payment made. Failing to make deposits in accordance with the deposit schedule may result in failure-to-pay penalties of up to 15% of what the deposit would be.
Roseville employers are also required to report wages, tips, and other forms of compensation paid to employees. Employers can report this information to the IRS using a form specifically for the industry that their business does work in. At the end of each year, employers are also required to prepare and file Form W-2, which reports wages, tips, and other compensation that was paid to employees.
In addition to reporting wages and tips, employers must also report the federal tax deposits that they make, their annual federal unemployment tax return, their employer’s quarterly payroll tax return, and the annual return of withheld federal income tax. Employers may also be required to file reports with local and state agencies.
Accountant for Employment Taxes in Roseville, California
The Roseville employment tax accountants that work with Cook CPA Group put their experience to use to help employers file their employment taxes. Cook CPA Group is available to meet with potential clients during a free consultation; contact them soon to schedule one. Call (916) 432-2218 today.