The weekly payroll of Abkar Hardware includes 19 employees who earn $280.00. How much is the employer's share of total social security and Medicare taxes for the first quarter of the year?
280*19= 5,320
Quarter(13 weeks)
5,320*13= 69,160
FICA=6.2%
MED=1.45%
69,160*6.2%= 4,287.92
69,160*1.45%= 1,002.82
4,287.92+1,002.82= $5,290.74
278.46
$5,290.74
To determine the employer's share of total social security and Medicare taxes for the first quarter of the year, you need to consider the applicable tax rates and the total wages paid to the employees.
The Social Security tax rate for both employees and employers is currently 6.2% of the wages, up to a maximum wage base of $142,800 for the year 2021.
The Medicare tax rate for both employees and employers is a flat rate of 1.45% of all wages, with no wage base limit.
Let's calculate the total wages paid to the employees in a week:
Total wages per employee = $280.00
Number of employees = 19
Total wages paid = Total wages per employee * Number of employees
Total wages paid = $280.00 * 19
Now, we'll calculate the employer's share of social security taxes for the first quarter:
Social Security tax rate = 6.2%
Total taxable wages for social security = minimum of (Total wages paid, maximum wage base)
First, we calculate the initial amount:
Initial amount = Total wages paid * Social Security tax rate
Next, let's compare the initial amount to the maximum wage base:
Maximum wage base = $142,800 (for 2021)
Total taxable wages for social security = minimum of (Initial amount, Maximum wage base)
Now, we'll calculate the employer's share of social security taxes:
Employer's share of social security taxes = Total taxable wages for social security * Social Security tax rate
Finally, we'll calculate the employer's share of Medicare taxes for the first quarter:
Medicare tax rate = 1.45%
Employer's share of Medicare taxes = Total wages paid * Medicare tax rate
By plugging in the values and following the calculations, you should be able to find the answer to the question.