PayWow pays employment taxes on the business’s behalf, and these taxes include federal & state withholding taxes and unemployment insurance taxes.


To learn more about how to stay tax compliant with PayWow, click here.


Federal Tax: Federal taxes are withheld from employees’ payroll for every pay schedule. PayWow pays these taxes to the federal agency based on the business’s deposit schedule (semimonthly or monthly).  


State Tax: State taxes are imposed on the taxable income of employees and businesses; these taxes are paid to respective state agencies by PayWow based on the deposit schedule. 

 

Federal and State Unemployment Taxes: The employer must contribute to federal and state unemployment taxes; if each employee’s wages exceed the wage base rate, the employer can stop paying the FUTA.  SUTA is based on the number of unemployment claims that are filed by terminated employees. 


Both FUTA & SUTA are calculated on every payroll. FUTA & SUTA taxes will be debited from the employer’s bank account at the end of every quarter based upon the prevailing SUTA rate. PayWow pays FUTA & SUTA taxes to federal and state agencies every quarter. 


PayWow reports these taxes to appropriate taxing jurisdictions every quarter, except FUTA tax which is reported annually.