Lauprechta Inc. has the following employees on payroll:
Assume that the employer uses the percentage method of withholding.
 
Use withholding allowance and percentage method tables.
 
Complete the table for taxes to be withheld for each pay period.
(Round your intermediate computations and final answers to 2 decimal places.)
 

	Semimonthly Payroll			Withholding Allowances		Marital Status
Naila	$	5,000		2		Married
Wilfred	$	5,600		2		Married
Byron	$	4,000		2		Single
Annie	$	4,600		0		Single

 

 
Explanation
Naila:
Federal Withholding: $5,000.00 − $337.60 = $4,662.40 – $3,523.00 = $1,139.40 × 25% = $284.85 + $435.55 = $720.40.
Social Security: $5,000.00 × 6.2% = $310.00.
Medicare: $5,000.00 × 1.45% = $72.50.
Total Withholding: $720.40 + $310.00 + $72.50 = $1,102.90.
 
Wilfred:
Federal Withholding: $5,600.00 − $337.60 = $5,262.40 − $3,523.00 = $1,739.40 × 25% = $434.85 + $435.55 = $870.40.
Social Security: $5,600.00 × 6.2% = $347.20.
Medicare: $5,600.00 × 1.45% = $81.20.
Total Withholding: $870.40 + $347.20 + $81.20 = $1,298.80.
 
Byron:
Federal Withholding: $4,000.00 – $337.60 = $3,662.40 – $1,677.00 = $1,985.40 × 25% = $496.35 + $217.75 = $714.10.
Social Security: $4,000.00 × 6.2% = $248.00.
Medicare: $4,000.00 × 1.45% = $58.00
Total Withholding: $714.10 + $248.00 + $58.00 = $1,020.10.
 
Annie:
Federal Withholding: $4,600.00 – $.00 = $4,600.00 – $3,925.00 = $675.00 × 28% = $189.00  + $779.75 = $968.75.
Social Security: $4,600.00 × 6.2% = $285.20
Medicare: $4,600.00 × 1.45% = $66.70.
Total Withholding: $968.75 + $285.20 + $66.70 = $1,320.65.
   
Allison is paid $1,500 per week. What is the amount of federal income tax withheld from Allison’s paycheck under the following conditions?
Assume that her employer uses the percentage method of withholding.
 
Use withholding allowance and percentage method tables.
 
Allison is single and claims two withholding allowances.
Allison is married and claims two withholding allowances.
Allison is single and claims no withholding allowance.
(For all requirements, round your intermediate computations and final answers to 2 decimal places.)

 
Explanation
In general take the wages and subtract the withholding allowances allowed; follow the chart for the remaining calculations.
$1,500.00 − $155.80 = $1,344.20 − $774.00 = $570.20 × 25.00% = $142.55 + $100.50 = $243.05
$1,500.00 − $155.80 = $1,344.20 − $525.00 = $819.20 × 15.00% = $122.88 + $35.90 = $158.78
$1,500.00 − $0.00 = $1,500.00 − $774.00 = $726.00 × 25.00% = $181.50 + $100.50 = $282.00
   
Baker Company is trying to determine how often it needs to deposit payroll taxes for calendar year 2017.
The company made the following quarterly payroll tax deposits during the last two years:
 

Quarter beginning January 1, 2015	$8,200
Quarter beginning April 1, 2015	8,200
Quarter beginning July 1, 2015	8,400
Quarter beginning October 1, 2015	9,500
Quarter beginning January 1, 2016	9,500
Quarter beginning April 1, 2016	9,500
Quarter beginning July 1, 2016	8,400
Quarter beginning October 1, 2016	9,500

 
a. What is the amount from the lookback period?
 
b. In 2017, how often must Baker Company make payroll deposits?
 
Monthly
 

 
Explanation
Quarters beginning July 1, 2015 – April 1, 2016 for a total of $36,900.
The lookback period totals were $36,900, this is less than the $50,000 threshold,
so Baker is a monthly schedule depositor.
   
Jacob Turner hired Jen Hatcher as a housekeeper starting on January 2 at $842 per month.
Jacob does not withhold any federal taxes. Assume that Jen is not a housekeeper for anyone else.
Assume that Jacob paid $2,526 in wages for the fourth quarter of 2017.
How much in social security tax should Jacob pay?
(Round your final answers to 2 decimal places.)
How much in Medicare tax should Jacob pay?
(Round your final answers to 2 decimal places.)
How much in FUTA tax should Jacob pay?
 

Explanation
$842.00 × 12 months = $10,104.00; $10,104.00 × 12.4% = $1,252.90
$842.00 × 12 months = $10,104.00; $10,104.00 × 2.9% = $293.02
$842.00 × 12 months = $10,104.00; $7000.00 × 0.6% = $42.00. Only the first $7,000 is subject to FUTA tax.
   
Henry, who earned $77,700 during 2017, is paid on a monthly basis, is married, and claims four allowances.
Assume that his employer uses the percentage method of withholding.
 
Use withholding allowance and percentage method tables.
 
What is Henry’s federal tax withholding for each pay period?
What is Henry’s FICA withholding for each pay period?
(For all requirements, round your intermediate computations and final answers to 2 decimal places.)

 
Explanation
$77,700.00/12 months = $6,475.00.
4 allowances × $337.50 = $1,350.00;
$6,475.00 – $1,350.00 = $5,125.00 – $2,275.00 = $2,850.00 × 15% = $427.50 + $155.40 = $582.90
OASDI = $6,475.00 × 6.2% = $401.45 per month;
Medicare = $6,475.00 × 1.45% = $93.8875 per month.
Total FICA withheld = $401.45 + $93.8875 = $495.34