Sy Accountancy Corporation
704 Mira Monte Place, Pasadena, California 91101
Tel (626) 744-0200, Fax (626) 744-0300, vsy@victorsycpa.com
PAYROLL TAX GUIDE FOR 2006
By Victor Sy, CPA, MBA
Withheld
From Paid By
Employee Employer
1. FICA (Social
Security Tax):
a. Old
Age Rate
6.20%
6.20%
Maximum
Wage $94,200.00 $94,200.00
Maximum
Tax $5,840.40
$5,840.40
b. Medicare Rate 1.45% 1.45%
No
Maximum ALL WAGES ARE TAXABLE
2. SDI (State
Disability Insurance):
a. Rate 0.80% NONE
b. Maximum
Taxable Wage $79,418.00 NONE
c. Maximum
SDI Tax $635.34 NONE
3. SUI (State
Unemployment Insurance):
a. Rate
(3.4% for new employers) NONE 1.7% to
7.1%
b. Maximum
Taxable Wage NONE $7,000.00
c. Maximum
SUI Tax NONE
$119 to $497
4. ETT (Employment
Training Tax):
a. Rate NONE 0.10%
b. Maximum
Taxable Wage NONE $7,000.00
c. Maximum
ETT Tax NONE $7.00
5. FUTA (Federal
Unemployment Tax):
a. Federal
Rate NONE 6.20%
b. Maximum
Taxable Wage NONE $7,000.00
c. Maximum
State Credit NONE 5.40%
d. Average
Net Federal Rate NONE 0.80%
e. Average
FUTA Tax NONE $56.00
f. Deposit
Required if FUTA is over $500.00
g. Credit
Card Payment Beginning
2006
--------------------------------------------OTHER
INFORMATION-------------------------------------------
6. SELF-EMPLOYMENT
TAX:
a. Old
Age Rate . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
12.40%
Maximum
Earnings . . . . . . . . . . . . . . . . . . . . . $94,200.00
Maximum
Tax . . . . . . . . . . . . . . . . . . . . . . . . . $11,680.80
b. Medicare Rate . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . 2.90%
No
Maximum . . . . . . . . . . . . . . . . . . . . . . . . . ALL WAGES ARE TAXABLE
7. CHILDREN
EMPLOYED BY SOLE PROPRIETORS: FICA not required for children
through age 17 (through 20 for FUTA). Both required
for corporations and partnerships.
8. MINIMUM WAGE:
Remains at . . . . . . . . . . . . . .
. . . . . . . . . . . $6.75
9. SOCIAL SECURITY
TAXES:
a. Earnings
needed to earn SS coverage ($970 x 4) .
. . . . . . $3,880.00
b. Maximum
amount of earnings to receive full SS benefits . $12,480.00
10. AUTO STANDARD
MILEAGE ALLOWANCES:
a. Business
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44.5 cents per mile
b. Charity . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . 14 cents per mile
c. Medical,
Moving . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
cents per mile