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Social Security Tax
Tax Withholding Policies
Social Security Tax
Social Security Tax is a federal payroll tax collected under the Federal Insurance Contributions Act (FICA) to fund the U.S. Social Security program.
It provides benefits for:
- Retired workers
- Disabled individuals
- Survivors of deceased workers
- Dependents of beneficiaries
Medicare Tax
Tax Withholding Policies
Social Security Tax
Medicare Tax is a federal payroll tax collected under the Federal Insurance Contributions Act (FICA) to fund the U.S. Medicare program.
This program provides health insurance for:
- People aged 65 and older
- Certain younger individuals with disabilities
- People with End-Stage Renal Disease (ESRD)
Self Employment Tax
Tax Withholding Policies
Tax Withholding Policies
Self-Employment Tax is the U.S. payroll tax paid by individuals who work for themselves.
It covers contributions to:
- Social Security
- Medicare
In a regular job, these taxes are split between employer and employee. But if you are self-employed, you pay both portions yourself.
Tax Withholding Policies
Tax Withholding Policies
Tax Withholding Policies
Tax withholding is the process where employers (or payers) deduct taxes directly from wages, salaries, or payments before they are paid to an employee or taxpayer. These withheld taxes are then remitted to the IRS or state tax authority.
It ensures the government collects taxes throughout the year rather than waiting until taxpayers file r
Tax withholding is the process where employers (or payers) deduct taxes directly from wages, salaries, or payments before they are paid to an employee or taxpayer. These withheld taxes are then remitted to the IRS or state tax authority.
It ensures the government collects taxes throughout the year rather than waiting until taxpayers file returns.
Withholding tax process flow:
Employee (Form W-4) → Employer calculates → Deduction from paycheck → Remittance to IRS/State → Reporting (W-2 & 941) → Reconciliation at year-end (Form 1040).