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Get your paychecks right by quickly calculating your employees’ payroll taxes, withholdings and deductions.
Updated: March 15, 2023
Choose your state below to find a state-specific payroll calculator, check 2023 tax rates, and other local information:
If it’s time to pay your employees, you’re in the right place! Our free payroll tax calculators make it simple to figure out withholdings and deductions in any state — for any type of payment. Employers can use it to calculate net pay and figure out how much to withhold, so you can be confident about your employees’ paychecks.
We also have special calculators for bonuses, final payments, or any other situation that might arise for employers. Try out our payroll calculators above or read on for a great payroll overview.
We’ll go over the basics employers need to know below, but you can also use our payroll processing guide to find definitions, tax forms, and detailed instructions for calculating payroll on your own.
To run payroll, you need to do seven things:
The calculator above can help you with steps three and four, but it’s also a good idea to either double-check the calculator by using the payroll tax rates below, or save time and effort by using a reliable payroll service.
The steps our calculator uses to figure out each employee’s paycheck are pretty simple, but there are a lot of them. Here’s how it works, and what tax rates you’ll need to apply.
Are you trying to save time on payroll-related to-dos? Easily compare payroll services in just a few clicks using our side-by-side comparison tool, which summarizes user reviews, features, ratings, and how each provider stacks up against one another.
Now that we’ve covered some quick facts about federal taxes and how they apply when using our payroll calculators, it’s important to remember that you’re likely responsible for state payroll taxes as well.
Though the rules and regulations can vary depending on where you do business, employers are typically responsible for withholding state payroll taxes from their employees’ paychecks and making sure they are remitted to the appropriate state agency.
State payroll taxes, which are usually based on a percentage of each employee’s gross income, are commonly used to fund unemployment and disability benefits for workers, and can sometimes be used toward other state-specific programs. State unemployment insurance (SUTA) is typically an employer-only payroll reduction, and companies that have employees are generally responsible for contributing once a quarter. There are some exceptions to this rule however. For instance, in the states of Alaska, New Jersey, and Pennsylvania, both employees and employers pay SUTA.
In addition, different tax rates are applied to employers based on factors such as length of time in business and even industry. For instance, some states have a separate “new employer” rate (this includes Illinois and Michigan), while others use a different tax rate for construction companies. Each state has its own:
For example, in the state of Michigan, the SUI tax rate for new employers (with exception of construction workers) is 2.7%. In addition, the taxable wage base is $9,500. In this example, an employee’s wages would be taxed at a rate of 2.7% up to the first $9,500, or around $256.50.
If you click into any state calculator from the dropdown at the top of this page, you should find your state’s current 2023 SUI and taxable wage rates listed (and links to each state’s website to make finding this information directly from the original source a little easier). In addition, you may find the state-by-state list of local tax agencies helpful if you are looking for a form (or need contact information for your state).
In the end, it’s a good idea to understand how local taxes work and your obligations as an employer. If you remain unsure about any part of local tax requirements and their application, it is a good idea to consult with a bookkeeper, CPA, or tax professional.
By now, you should know everything you need to know about payroll and payroll taxes. We recommend diving into our free calculators (which even let you print out pay stubs). Or if you’d like to make life a little easier on yourself, check out our award-winning payroll software.
For employers who do payroll themselves, we help you save over 15 hours a month by calculating your paychecks, filing all your payroll taxes (including W-2s and 1099s), handling the direct deposit payments, and a whole lot more.
This article (and mentioned payroll calculator tool) is provided for informational purposes only and should not be relied on for tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors for formal consultation.
Just share some basic information, then we’ll set everything up and import your employees’ information for you. It couldn’t be easier.
Employer taxes are calculated using a number of variables, including the type of tax, the employee’s wages or salary, and the employer’s payroll tax rate.
The federal payroll tax (FICA) is currently 15.3% and is split equally between employers and employees. Here’s how it breaks down: Employers pay 6.2% of Social Security tax and employees pay 6.2%, for a total of 12.4%. A further 1.45% of Medicare tax is paid by the employee, and the employer matches this 1.45%, for a total of 2.9%. The combined rate is 15.3%.
Several payroll taxes are the sole responsibility of the employer and are not withheld from their employees’ paychecks. Some examples include the Federal Unemployment Tax Act (FUTA) tax, which funds the federal unemployment insurance program. Another example includes state unemployment taxes, which help fund the state unemployment insurance program where an employer does business. Most states require employers to provide workers’ compensation insurance, which pays benefits to employees who are injured or sick on the job and is calculated as a percentage of payroll.