The fica taxes for employee

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Reference no: EM131812814

Note: In this chapter and in all succeeding work throughout the course, unless instructed otherwise, use the following rates, ceiling, and maximum taxes.

Employee and Employer OASDI:	6.20%	$118,500	$7,347
Employee* and Employer HI:	1.45%	No limit	No maximum
Self-employed OASDI:	12.4%	$118,500	$14,694
Self-employed HI:	2.9%	No limit	No maximum

1.	Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the over-time rate).
2.	If the third decimal place is 5 or more, round to the next higher cent.
3.	If the third decimal place is less than 5, simply drop the third decimal place.
	Examples:	Monthly rate $1,827 Weekly rate ($1,827 × 12)/52 = $421.615 rounded to $421.62 Hourly rate $421.62/40 = $10.540 rounded to $10.54 O.T. rate $10.54 × 1.5 = $15.81

Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.
*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.

Example 3-1

The biweekly taxable wages for the employees of Rite-Shop follow. Compute the FICA taxes for each employee and the employer's FICA taxes.

If required, round your answers to nearest cent and use the rounded answers in subsequent computations. Round your final answers to the nearest cent.

				FICA Taxes
Employee No.	Employee Name	Biweekly Taxable Wages		OASDI	HI
711	Castro, Manny		$1,000.00	$	$
512	Corrales, Pat		968.00
624	Guitar, Joseph		1,004.00
325	Moore, Connie		1,046.40
422	Morrison, Harry		1,200.00
210	Robertson, Catherine		1,044.80
111	Swarez, Joseph		1,122.00
	Totals		$	$	$

Employer's OASDI	$		$
	Total Taxable Wages		Employer's OASDI Tax

Employer's HI Tax	$		$
	Total Taxable Wages		Employer's HI Tax

Reference no: EM131812814

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