How do I calculate tax witholding for single member LLC (SMLLC) who paid salary to an employee?

Question

Hi, I started a SMLLC - Single member Limited Liability Comany and paid an employee salaries. I know I need to withold a portion of it as payroll taxes. How can I figure out how much to withold? If you know a link where I can visit, that would be great too! I have tried to do reserch on my own but cannot figure it out!! Many thanks in advance!

Answer 1

paycheckcity.com

Answer 2

Go to http://www.irs.gov and grab a copy of IRS Pub 15, also known as Circular E, as well as the supplements thereto. That will tell you EVERYTHING that you need to know about withholdings, payroll taxes, and payroll tax returns.

Your state has similar procedures. Even if your state doesn't levy an income tax you still need to file payroll tax returns and pay unemployment taxes on the wages that you pay. Check with your state's department of revenue or employment security department for their filing and payment requirements.

Answer 3

You need to withhold 12.4% social security tax, which represents both the employee and employer portion. You also need to withhold 2.9% medicare tax, which represents both the employee and the employer portion.

As far as federal withholding, this depends on how the employee filled out Form W-4, salary, exemptions, how often they get paid, etc.

You can use this link to figure out each employee's tax withholdings.
http://www.paycheckcity.com/netpaycalc/netpaycalculator.asp

You are required to file quarterly payroll tax returns, (Form 941) and Form 940 for federal unemployment. You may also be required to file state payroll tax returns, depending on what state you are in.

Employer's Tax Guide
http://www.irs.gov/publications/p15/index.html

Answer 4

For answers to questions about how to calculate withholding, deposit taxes, and file the appropriate tax returns (for both federal and state), check out the following:

Answer 5

Your best avenue would be to see a certified public accountant. This may save you in the long haul.