Which of the following taxes must be paid only by the employer?
A. Federal income
B. FICA
C. Federal unemployment
D. State
C.
Correct.
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To determine which of the following taxes must be paid only by the employer, we need to understand the purpose and responsibility for each tax.
A. Federal income tax is a tax that is levied on individuals and corporations based on their earnings or profits. It is typically paid by both employers and employees. Employees have federal income tax withheld from their wages by the employer and the employer is responsible for remitting the tax to the government.
B. FICA (Federal Insurance Contributions Act) tax consists of two components: Social Security tax and Medicare tax. It is a payroll tax that is intended to provide benefits for retired and disabled individuals, as well as medical coverage for people over 65 years of age. FICA taxes are generally split between employers and employees, with each paying a certain percentage.
C. Federal unemployment tax, also known as the Federal Unemployment Tax Act (FUTA) tax, is a tax levied on employers only. It is used to provide funds for state unemployment agencies and covers benefits for laid-off workers. Employers are responsible for paying FUTA tax based on the wages paid to their employees.
D. State taxes vary by jurisdiction and can include income tax, sales tax, property tax, and more. Employer responsibilities for state taxes can also vary depending on the specific tax and state laws. Generally, state taxes are paid by both the employer and employee, with both parties contributing a certain percentage.
Based on this information, the only tax on the list that must be paid only by the employer is the Federal unemployment tax (C).