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An HR Glossary for HR Terms

Glossary of Human Resources Management and Employee Benefit Terms

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Employer Payroll Taxes

What Are Employer Payroll Taxes?

Employer payroll taxes are the portion of payroll taxes companies are responsible for, including Social Security tax, Medicare tax, federal unemployment tax, and state unemployment tax. 

Social Security Tax

Both the employer and the employee are responsible for paying Social Security payroll taxes. For Social Security taxes, employers pay 6.2 percent of each employees’ wages, and employees must match that same 6.2 percent. 

Medicare Tax

This tax is also shared by the employer and employee. Each party is responsible for 1.45 percent of an employee’s wages.

Federal Unemployment Tax

This is only an employer payroll tax. There are no deductions taken from employees’ wages for federal unemployment. Employers pay 6 percent of the first 7,000 dollars they pay each employee every year. 

State Unemployment Tax

State unemployment taxes are also employer-only payroll deductions except for in Alaska, New Jersey, and Pennsylvania. To find your state unemployment tax rate, visit your state’s Department of Labor website. 

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