Monday, January 27, 2014

IRS Publication 15 – A Tax Guide For the Employers – Pub 15

IRS publication 15 is a document detailing the responsibilities of an employer for filing and reporting tax related information to the Internal Revenue Service. The document covers a number of different tax related aspects on behalf of the employees like reporting, withholding and depositing along with correction and payment of taxes. In IRS publication 15 you can always expect the most up to date tax information and withholding tables of the year.
This particular publication is actually used for determining the federal income tax and not the state and local taxes and employers are required to refer to the tax rules of their respective states for ensuring proper amounts for state income tax that are withheld from the paychecks of the employees.
A supplemental tax guide for employers:
Publication 15 A, that supplements the IRS publication 15 under Circular E, actually serves as a tax guide for the employers. The publication contains detailed and specialized information about employment tax. On the other hand Publication 15B is a guide for the employers for fringe benefits and carries information on non-cash compensation types of employment tax. As an employer’s tax guide Publication 15 explains the tax responsibilities of an employer and also has tables that are required to figure out the amount of tax that is to withhold from the employees.
As per IRS publication 15, you need to verify that your employees are legally eligible to work in the country. Thus,you must fill out Form I-9 of U.S. Citizenship and Immigration Services for verification of employment eligibility. You are also required to report every new appointment and a new appointment means appointing someone who was never before appointed by you including those who were previously appointed but were separated for more than sixty consecutive working days.
New in 2013:
Employers are required to implement the withholding tables for 2013 before February 15 and use the tables for 2012 until then. According to IRS publication 15, the social security tax rate for employees is going to be 6.2% instead of its previous rate of 4.2%. But the employer’s tax rate for the same remains unchanged at 6.2% and the wage base limit for social security is also set to $113,700 for the year 2013. Following the latest additions in Publication 15 as an employer you are also required to withhold 0.9% as Additional Medicare Tax along with 1.45% of Medicare Tax. This Additional Medicare Tax is withheld from the employees only and there is no share of the employer in it.

As per IRS publication 15, starting from January 1, 2013, withholding limit on payment of wages to any particular employee above 1 million dollars is set at 39.6% in place of its previous rate of 35%. Now you can also avail tax credit on the appointment of unemployed but eligible veterans who must start working by the end of the year 2013. You can also use Form 5884-C to claim work opportunity tax credit against their payroll liability.
Georgia Business Tax Extension

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