Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Use the following tax rates, ceiling and maximum taxes: Employee and Employer OASDI: 6.20% $142,800 $8,853.60 Employee and Employer HI: 1.45% Self-employed OASDI: 12.4%
Use the following tax rates, ceiling and maximum taxes: Employee and Employer OASDI: 6.20% $142,800 $8,853.60 Employee and Employer HI: 1.45% Self-employed OASDI: 12.4% No limit $142,800 No maximum $17,707.20 Self-employed HI: 2.9% No limit No maximum *Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed. Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows: 1. Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the overtime rate). 2. If the third decimal place is 5 or more, round to the next higher cent. 3. If the third decimal place is less than 5, drop the third decimal place. Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow. Eager, a tipped employee, reported to his employer that he had received $320 in tips during March. On the next payday, April 6, he was paid his regular salary of $400. Round your answers to the nearest cent. a. The amount of OASDI taxes to withhold from Eager's pay is b. The amount of HI taxes to withhold from Eager's pay is
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started