Question
Use the following tax rates, ceiling and maximum taxes: Employee and Employer OASDI: 6.20% $127,200 $7,886.40 Employee* and Employer HI: 1.45% No limit No maximum
Use the following tax rates, ceiling and maximum taxes: | |||
Employee and Employer OASDI: | 6.20% | $127,200 | $7,886.40 |
Employee* and Employer HI: | 1.45% | No limit | No maximum |
Self-employed OASDI: | 12.4% | $127,200 | $15,772.80 |
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:
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).
If the third decimal place is 5 or more, round to the next higher cent.
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.
Crow earned $585.15 during the week ended March 1, 20--. Prior to payday, Crow had cumulative gross earnings of $4,733.20. Round your answers to the nearest cent.
a. The amount of OASDI taxes to withhold from Crow's pay is | $._______ |
b. The amount of HI taxes to withhold from Crow'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