Hi Can you please some tell me why do employers charge additional 10% payroll taxes on employees.?

Question

Assume that employee is on Bench and he requested his employer to run his payorll for 1 month(on bench).

Does employer has right to charge 10% additional payroll taxes?

Answer 1

OMG.  That is soooo illegal.

Payroll taxes = 7.65% total

If the employer is deducting a flat 10%, then this activity is ILLEGAL.

The employer has to pay an additional 7.65% but they cannot list it as a deduction from your stated rate of pay.

Answer 2

It is called FICA taxes. Social Security is 7.65% (upto a max salary which increases every year) and Medicare is 1.45%.

This is an equal contribution. That means, an employee has to pay that amount as well as the Employer.

So where does the employer get this money from? From your pocket. It is another way of saying that "if I have to pay you a 100K per annum, I am actually spending approx 10% more". This is also called as cost of employee.

It is not illegal, because they factor this when deciding what to pay you.

Answer 3

There are four types of payroll taxes that are normally taken out:

Federal Income Tax

Social Security

Medicare (sometimes SS and medicare are combined and called FICA)

State Income Tax

Answer 4

They don't.  Not legally anyway.

Answer 5

What payroll taxes are you talking about?

Answer 6

What do you mean by addtional 10% payroll taxes?  By law employers are required to COLLECT taxes from wages before the employee is paid, and whatever they are COLLECTING from your check needs to be itemized on your paycheck stub.  If there is an additional 10% beyond the standard income taxes (both federal and state), Social Security, Medicare, etc etc. then they have to list what that is.  It could be for health insurance premiums, union dues, pension plan, etc. - if you don't know what it is, ask your payroll department to explain it to you.

Answer 7

Are you sure it is not something in relation to what each employee claims (i.e. single & 1, married 2, etc) that affects the tax being witheld?

And if you are asking about different employers regarding you as the emploee, then ask for copies of the W-4 that you completed at time of hire. That will show you if you completed them differently (i.e. single & 1 vs. single & 0)

Answer 8

Because we have and out of control entitlement system that both parties are too chicken to confront.  So they rip off employees and their employers to fund their gov't ponzi scheme.

Answer 9

What is on bench?