Mandi Robinson, married with three allowances, earns a monthly salary of $2,400. She also receives a quarterly bonus on sales that exceed her quota. For the first quarter, her bonus amounts to $4,600. Robinson’s employer pays her the regular monthly salary and the bonus together on her March paycheck. The withholding for the March pay is computed on the total amount of $7,000 ($2,400 + $4,600). After deducting the allowances, using the percentage Tax Table 4(b), the amount to withhold is $563.70 [$7,000 - 3($350.00) = $5,950.00 - $2,600.00 = $3,350.00 × 12% = $402.00 + $161.70]. Example 4-9 From the above example, if you indicate separately on Robinson’s paycheck stub the amount of each payment, the amount of federal income tax to be withheld is computed as follows: Taxes Withheld Regular monthly earnings $2,400 $ 37.00 (from wage-bracket tax tables*) Quarterly bonus 4,600 1,012.00 ($4,600 × 22%) Totals $7,000 $ 1,049.00 The calculation of Robinson’s federal income tax for the quarter would be computed as follows: Taxes Withheld Regular monthly earnings $2,400 $37.00 × 3 months = $ 111.00 (from wage-bracket tables*) Quarterly bonus 4,600 1,012.00 ($4,600 × 22%) $1,123.00 *The percentage table could also be used. Note: OASDI and HI withholdings are calculated on total earnings per pay period multiplied by number of pay periods and then added together to arrive at a quarter’s total withholding. Quarterly and year-to-date information would appear on Robinson’s employee earnings record. Lake Community College gives its faculty the option of receiving the balance of their contract at the end of the semester on May 17, 20--. The faculty can receive one lump-sum payment instead of receiving the remaining seven biweekly pays over the summer. Use the data given below to complete the Payroll Register on May 17. No employee has reached the OASDI ceiling, and all employees are taking the lump-sum payment. The state withholding rate is 2.0% of total earnings; the city withholding rate is 1.0% of total earnings. The biweekly wage bracket is used for federal income taxes. To calculate the tax withholdings, you must calculate the rounded tax for each pay and multiply by the number of pays in the lump-sum payment. Round all values to the nearest cent. Click here to access the Wage-Bracket Method Tables. For Period Ending May 17, 20-- Employee Name Marital Status No. of W/H Allow. Biweekly Earnings (a) Deductions (f) Total Lump-Sum Payment (b) FICA (c) (d) (e) Net OASDI HI FIT SIT CIT Pay Kinnery, Thomas S 1 $2,000.00 $ $ $ $ $ $ $ Matthews, Mary M 2 2,600.00 Grace, Catherine S 0 2,200.00 Michael, Sean S 1 2,060.00 Totals $8,860.00 $ $ $ $ $ $ $ Compute the employer's FICA taxes for the pay period ending May 17, 20--. OASDI Taxes HI Taxes OASDI taxable earnings $ HI taxable earnings $ OASDI taxes $ HI taxes $
****Please just answer as much as you can. I can do the ones that require the tax table but need help on Total Lump-Sum more than anything. Thanks. *******
Example 4-8
Mandi Robinson, married with three allowances, earns a monthly salary of $2,400. She also receives a quarterly bonus on sales that exceed her quota. For the first quarter, her bonus amounts to $4,600. Robinson’s employer pays her the regular monthly salary and the bonus together on her March paycheck. The withholding for the March pay is computed on the total amount of $7,000 ($2,400 + $4,600). After deducting the allowances, using the percentage Tax Table 4(b), the amount to withhold is $563.70 [$7,000 - 3($350.00) = $5,950.00 - $2,600.00 = $3,350.00 × 12% = $402.00 + $161.70].
Example 4-9
From the above example, if you indicate separately on Robinson’s paycheck stub the amount of each payment, the amount of federal income tax to be withheld is computed as follows:
| Taxes Withheld | |||||
| Regular monthly earnings | $2,400 | $ 37.00 | (from wage-bracket tax tables*) | ||
| Quarterly bonus | 4,600 | 1,012.00 | ($4,600 × 22%) | ||
| Totals | $7,000 | $ 1,049.00 |
The calculation of Robinson’s federal income tax for the quarter would be computed as follows:
| Taxes Withheld | |||||
| Regular monthly earnings | $2,400 | $37.00 × 3 months = | $ 111.00 | (from wage-bracket tables*) | |
| Quarterly bonus | 4,600 | 1,012.00 | ($4,600 × 22%) | ||
| $1,123.00 |
*The percentage table could also be used.
Note: OASDI and HI withholdings are calculated on total earnings per pay period multiplied by number of pay periods and then added together to arrive at a quarter’s total withholding. Quarterly and year-to-date information would appear on Robinson’s employee earnings record.
Lake Community College gives its faculty the option of receiving the balance of their contract at the end of the semester on May 17, 20--. The faculty can receive one lump-sum payment instead of receiving the remaining seven biweekly pays over the summer. Use the data given below to complete the Payroll Register on May 17. No employee has reached the OASDI ceiling, and all employees are taking the lump-sum payment. The state withholding rate is 2.0% of total earnings; the city withholding rate is 1.0% of total earnings. The biweekly wage bracket is used for federal income taxes.
To calculate the tax withholdings, you must calculate the rounded tax for each pay and multiply by the number of pays in the lump-sum payment.
Round all values to the nearest cent.
Click here to access the Wage-Bracket Method Tables.
For Period Ending May 17, 20--
Employee Name |
Marital Status |
No. of W/H Allow. |
Biweekly Earnings |
(a) | Deductions | (f) | ||||
| Total Lump-Sum Payment |
(b) FICA | (c) | (d) | (e) | Net | |||||
| OASDI | HI | FIT | SIT | CIT | Pay | |||||
| Kinnery, Thomas | S | 1 | $2,000.00 | $ | $ | $ | $ | $ | $ | $ |
| Matthews, Mary | M | 2 | 2,600.00 | |||||||
| Grace, Catherine | S | 0 | 2,200.00 | |||||||
| Michael, Sean | S | 1 | 2,060.00 | |||||||
| Totals | $8,860.00 | $ | $ | $ | $ | $ | $ | $ |
Compute the employer's FICA taxes for the pay period ending May 17, 20--.
| OASDI Taxes | HI Taxes | |||
| OASDI taxable earnings | $ | HI taxable earnings | $ | |
| OASDI taxes | $ | HI taxes | $ |
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