Circular E | IRS federal income tax withholding tables.
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Employee | Someone whose work is under the direction of an employer.
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Employee earnings records | Record of an employee's net pay, gross pay, deductions, and year-to-date payroll information.
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Employee's Withholding Allowance Certificate (Form W-4) | A form which shows an employee's withholding allowances.
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Federal Insurance Contributions Act (FICA) Taxes | Taxes assessed on both employers and employees; for Social Security and Medicare programs.
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Gross pay | Total compensation earned by an employee.
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Independent contractor | Someone who does a job for an employer, but decides how to do the work.
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Net pay | Gross pay less all deductions; also called take-home pay.
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Payroll bank account | Bank account used solely for paying employees; each pay period an amount equal to the total employees' net pay is deposited in it and the payroll checks are drawn on it.
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Payroll deductions | Amounts withheld from an employee's gross pay; also called withholdings.
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Payroll register | Record for a pay period that shows the pay period dates, regular and overtime hours worked, gross pay, net pay, and deductions.
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Salary | A fixed amount of compensation paid or received on a regular basis, such as every two weeks, monthly, or annually.
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Self-employment tax | Social Security and Medicare taxes for persons who operate their own businesses. Currently, the self-employment tax rates are 12.4% on the first $106,800 of income for Social Security and 2.9% on all income for Medicare.
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Wages | Money paid or received for work or services by the hour, day, or week or by the number of units produced.
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Withholding allowance | This determines the amount of federal income taxes to withhold from an employee's pay.
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