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Running a business is complicated, especially if you're a first-time small business employer. Don’t get overwhelmed -- get the help and support you need to accurately and efficiently calculate payroll taxes. Our free employer tax calculator simplifies the process and reduces the legwork and hassle of doing it all yourself.
Tax Calculator
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GET STARTEDWHY YOU SHOULD USE A
PAYROLL CALCULATOR
Estimate hiring costs
Take the guesswork out of payroll
Avoid significant financial penalties
Pay employees accurately and on time
Invest more time into running your business
Better manage temporary or seasonal employee payroll
What Are Payroll Taxes?
Payroll taxes are taxes levied by federal, state and local governments, paid by an employer on behalf of their employees. The exact amount is based on a percentage of the salaries and wages of employees and is paid to the Internal Revenue Service (IRS). Most of these funds are often used to finance specific social insurance programs, whereas income tax goes to the government’s general fund.
As an employer, you're responsible for paying a variety of taxes.
While this might not be your favorite aspect of being a small business owner, understanding it is essential to running a successful business. Employers pay federal and state unemployment taxes, which are governed by the Federal Unemployment Tax Act (FUTA). States have differing state unemployment insurance (SUI) programs.
Employees must also contribute to some payroll taxes, though not as much as the employers. The sum of Social Security and Medicare taxes are both split between employees and employers.Some elements of payroll taxes (like Social Security) are capped at a certain limit every year. The actual amount you'll owe the IRS depends on several factors, so be sure to consult with a tax professional.
FREE TAX CONSULTATIONWhere Do Payroll Taxes Go?
Example of Employer Cost Breakdown
Total payroll cost:
8% Federal unemployment taxes
8% State unemployment taxes
8% Medicare
8% Social security
8% Local taxes
Example of Employee Cost Breakdown
8% Federal unemployment taxes
8% State unemployment taxes
8% Medicare
8% Social security
8% Local taxes
8% Other taxes (income tax and employee deductions)
How to File Your Payroll Taxes
- Enter the payroll information into Bizee’s easy Employer Payroll Tax Calculator.
- Prepare your FICA taxes (Medicare and Social Security) monthly or semi-weekly, depending on your business’s tax liability.
- Deposit FUTA taxes (Federal Unemployment Tax) quarterly.
- Pay your federal payroll taxes online via the Electronic Federal Tax Payment System.
- Check with the IRS for ways to pay your local and state payroll taxes (varies by state).
Get the tools to launch your company with Bizee’s employer toolkit.
When building a business, seemingly small mistakes can end up costing a lot. Understanding federal tax rates, post-tax deductions, and how to accurately calculate employer payroll taxes can save time and money. Learn the ins-and-outs of employer taxes and much more with our practical start-up guides.
Other Frequently Asked Questions About Payroll Taxes
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