Payroll - Employer
Payroll: Employer As previously stated, the payroll area is two fold. The first was the wages expense and the second is the payroll taxes expense to you, the firm. The government taxes not only the employee as statement above, it also taxes the business for payroll taxes such as social security and medicare equal to what it taxes the employee. Further, the government taxes the enterprise for unemployment insurance. Therefore, the entry would be as follows:
| Dr. | Cr. | |
| Payroll Taxes Expense | XXXXXXX | |
|
Social
Security Payable
|
XX | |
|
Medicare
Payable
|
XX | |
| Federal Unemployment Payable | XX | |
| State Unemployment Payable | XX |
The firm must file various forms with respective governmental bodies. Form 941 is the Employer's Quarterly Federal Tax Return used for reporting social security and medical taxes and Form 940, the Employer'' Annual Federal Unemployment Tax Return, for reporting unemployment taxes. Form 8109-B, the Federal Tax Deposit Coupon, is used to make timely payments of social security, medicare and employee federal income tax withheld.
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