Texts: Example 4-4
To use the wage-bracket method for Manual Payroll Systems With Forms W-4 From 2020 or Later using Standard Withholding, follow the steps illustrated below.
Step 1
Select the withholding table that applies to the employee's pay period.
- Adrienne Huff is married filing Jointly (MFJ). She is paid weekly at a rate of $815.
Step 2
Locate the wage bracket (the first two columns of the table) in which the employee's gross wages fall.
Locate the appropriate wage bracket (see Figure 4.7):
At least $815 but less than $825
Step 3
Follow the line for the wage bracket across to the right to the column showing the appropriate filing status with standard withholding. Withhold this amount of tax.
- Move across the line to the column showing Married Filing Jointly, Standard withholding.
The tax to withhold is $32.
Figure 1.9
The names of the employees of Hogan Thrift Shop are listed on the following payroll register. Employees are paid weekly. The filing status is shown on the payroll register, along with each employee's weekly salary, which has remained the same all year. Complete the payroll register for the payroll period ending December 20, 20--, the 51st weekly payday. The state income tax rate is 2% of total earnings, the city income tax rate is 1.5% of the total gross earnings, and the wage bracket method is used for federal income taxes.
Enter all amounts as positive numbers. Round your calculations and final answers to the nearest cent. If an amount is zero, enter 0.
As we go to press, the federal income tax rates for 2023 are being determined by budget talks in Washington, and are not available for publication. For this edition, the 2022 federal income tax tables for Manual Systems with Forms W-4 from 2020 or Later with Standard Withholding and 2022 FICA rates have been used.
Click here to access the Wage-Bracket Method Tables.
Click here to access the Percentage Method Tables.
Hogan Thrift Shop Payroll Register Deductions
FOR PERIOD ENDING December 20, 20--
(a) FICA
Filing No. of W/H Total Employee Name Status Allowances Earnings
John, Matthew S N/A $2,900.00
Smith, Jennifer S N/A $275.00
Bullen, Catherine MFJ N/A $250.00
Matthews, Mary MFJ N/A $320.25
(b) FIT
O] x x av av x ox x x 0x
(c) IT
5s] v 5.5] v 5 v 6.41 v 9v 11.21] v 9.60 x 17.8 v
(d) CIT
43.5] v 4.13 V
(e) Aed Pay
OASDI
HI
42.05] v 3.99 V
179.5] x 17.05] v 15.5 ] v 19.86] v 27.90 v 34.75] v 29.48 ] v 55.1s
v 2,576.65 X
244.33] x 222.12] V 284.54] v 399.82X 498] x 422.49 X
3.63 V
3.75 4.8] v 6.75
4.64 V
Hadt, Bonnie
S S
N/A
$450.00 $560.50 $475.50
6.53 8.13] V 6.89] 12.91 | V 88.77|
Camp, Sean Aarav, Helen Gleason, Josie Totals
N/A
8.41 7.13] V 13.35 V
HH S
N/A
N/A
$890.00
$6,121.25
$91.82 J
Compute the employers FICA taxes for the pay period ending December 20, 20--.
OASDI Taxes HI Taxes
OASDI taxable earnings $350.52] + HI taxable earnings $1
OASDI taxes $350.52] X HI taxes $88.77] X
