Payroll Tax: a percentage withheld from an employee’s pay by an employer who pays it to the government on the employee’s behalf.
Fun Fact: If a business has employees in multiple states, payroll taxes could get more complex. Different states have their own rules regarding how payroll taxes are handled, as well as different rates in certain areas. Eager as you may be to hand out bonuses to star employees—wait. The timing of those bonuses could have tax implications. Not every employer issues paychecks weekly. That’s fine, but for payroll-tax purposes, overtime still must be broken down into weekly increments.
Trivia Question: What percent of the Medicare and social security does an employer pay?
Taxes! Taxes! Read All About It! 