What Is A Payroll Tax. Despite the name, payroll tax is not a single tax, but a blanket term used to refer to all taxes paid on the wages of employees. Federal payroll taxes are deducted directly from the employee's earnings and paid to the internal revenue service (irs).

Payroll tax — ➔ tax1 * * * payroll tax uk us noun c or u ► economics, tax any tax that is based on employees pay, and is either paid by an employer or partly taken by an employer from what employees earn:

Payroll taxes include federal income tax withholding and fica taxes, or social security and medicare tax, and state payroll taxes. These taxes are used to finance social insurance programs, such as in summary, payroll taxes are a significant source of government revenue, but the burden of the payroll tax and the government programs they. Key elements of the u.s. Federal payroll taxes are the same for all us businesses. Federal unemployment tax (futa) is an employer tax paid quarterly on the first $7,000 of every employee's paycheck. Payroll tax consists of social security and medicare taxes, otherwise known as federal insurance contributions act (fica) tax. There are a variety of payroll taxes, some paid by employers' payroll tax responsibilities are extensive. Payroll is the business process of paying employees and factoring out payroll taxes. The employee pays part of these taxes through a payroll deduction, and the employer pays the rest directly to the irs. Payroll taxes are all taxes that are collected, by federal, state, and local governments, based on salaries and wages paid to employees. They include figuring income tax withholding (federal and where applicable state and local).