Acccount

electronic federal tax payment system

System used by larger businesses to deposit tax payments by electronic funds transfer. 

form w-2

Wage and Tax Statement; form that summarizes an employee’s earnings and amounts withheld for federal, state, and local taxes. The employer has to send a W-2 to the employee by January 31 for the previous year (annually). The employee will use the W-2 to prepare their individual income tax returns. 

form w-3

Transmittal of Wage and Tax Statements; summarizes the information contained on the employee’s Forms W-2 and accompanies the Forms W-2 sent to the IRS (annually). 

payroll register

A form that summarizes information about employees (more than one) earnings for each pay period.

payroll tax expense

The expense account used to record the employer’s payroll taxes (FICA, FUTA, SUTA). 

salaries expense

The expense account used to record employee’s GROSS earnings. It includes the net income and all deductions for all of the employees for the pay period. It is recorded every pay period. REMEMBER: expenses have a normal DEBIT balance.

unemployment taxes

Taxes collected to provide funds for workers who are temporarily out of work; usually paid only by the employer. Some states also require employees to pay unemployment taxes. 

Employee’s federal income taxes

Entry to record payroll

Employees State Inc Taxes

Entry to record payroll

Federal unemployment taxes

Entry to record employer’s payroll taxes

Medicare taxes

Entry to Record Payroll

Social Security taxes

Entry to record employer’s payroll taxes

State unemployment taxes

Entry to record employer’s payroll taxes

Union Dues

Entry to record payroll