MGT 11A Chapter Notes - Chapter 9: Federal Insurance Contributions Act Tax, Current Liability, Life Insurance
Document Summary
Arise from salaries and wages, employee benefits, and payroll taxes levied on the employer. Gross pay: total compensation an employee earns including wages, salaries, commissions, bonuses, and any compensation earned before deductions such as taxes (wages usually refer to payments to employees at an hourly rate. Salaries usually refer to payments to employees at a monthly or yearly rate) Net pay (take home pay): gross pay minus all deductions. Payroll deductions (withholdings): amounts withheld from an employee"s gross pay, either required or voluntary. Requires deductions: result from laws and include income taxes and social security taxes. Voluntary deductions: at an employee"s option include pension and health contributions, health and life insurance premiums, union dues, and donations. Employer withholds payroll deductions from employees" pay and is required to send this money to the designated group or government. Employer records payroll deductions as current liabilities until these amounts are transmitted. Employee fica taxes: federal insurance contributions act taxes.