Under federal law, employers are required to withhold certain employment taxes from their employees. The taxes employers must withhold are:

  • Federal income tax
  • Social Security tax
  • Medicare tax

Federal Income Tax

Federal income tax is collected on a “pay as you go” basis. This means that the taxes are collected (i.e., withheld from your paycheck) as you earn the money. In most cases, this results in the taxes being taken out of your paycheck.

Social Security and Medicare Taxes

Social Security taxes are used to pay for the benefits of older individuals who no longer work but paid into the system while they worked, survivors of individuals who used to work and paid into the system, and those with disabilities that prevent them from working. An employee pays into Social Security and the employer then matches that amount. Medicare taxes pay for hospital benefits.

What Are My Employer’s Responsibilities?

Both you and your employer are responsible for ensuring that your employment taxes are paid. In particular, your employer must report income and employment taxes that are withheld from employees and then deposit these taxes appropriately.

Bear in mind that employee responsibilities may vary according to state law. For instance, employer’s responsibilities under California employment tax laws may have special requirements when it comes to independent contractors. Consult with an attorney if you have specific questions about the laws in your area.

What Are My Responsibilities As an Employee?

As an employee, you are liable for your employment taxes. While most employers withhold taxes on behalf of their employees, you are responsible for making sure your taxes are collected and paid if you employer doesn¿t do it for you. Even if you employer withholds taxes for you, you can still be responsible.

What Do I Do if My Employer Didn’t Collect and/or Pay My Employment Taxes?

If your employer didn’t withhold your taxes, it may be up to you to ensure they are paid properly. In addition, if your employer did withhold employment taxes but didn’t pay them properly, your employer may be guilty to employment tax evasion. Either way, tax law is very complicated and can get very frustrating. An experienced employment lawyer can help you ensure your taxes are collected and paid properly.