MGT 11A Chapter 9: CHAPTER 9 - pt 3
Document Summary
Employer must pay payroll taxes in addition to those required of employees. Employer fica tax: employers must pay fica taxes on their payroll. An employer"s tax is credited to the same fica taxes payable accounts used to record the social security and medicare taxes withheld with employees. Employer unemployment taxes: the federal gov works with states in a joint federal and state unemployment insurance programs. These programs provide unemployment benefits to qualified workers: Federal unemployment tax act (futa): employers must pay a federal unemployment tax on wages and salaries earned by their employees. State unemployment tax act (suta): all states fund their unemployment insurance programs by placing a payroll tax on employers. Base rate for states is adjusted according to an employer"s merit rating. Merit rating: rating assigned to an employer by a state based on the employer"s record of employment. Good rating: reflects stability in employment and means an employer can pay less than the 5. 4% base rate.
