Employer Withholding Taxes

Optional Computer Formula

TAXABLE WAGE WITHHOLDING DEDUCTION
    
$5,000 or less

WD

=

TW x .005
     PP
x 1.615
More than $5,000 but not more than $10,000

WD

=       (TW - 5000) x .01 + $25.00     
                       PP
x 1.615
More than $10,000 but not more than $15,000

WD

=       (TW - 10000) x .02 + $75.00    
                       PP
x 1.615
More than $15,000 but not more than $20,000

WD

=       (TW - 15000) x .025 + $175.00 
                       PP
x 1.615
More than $20,000 but not more than $40,000

WD

=       (TW - 20000) x .03 + $300.00   
                       PP
x 1.615
More than $40,000 but not more than $80,000

WD

=       (TW - 40000) x .035 + $900.00  
                       PP
x 1.615
More than $80,000 but not more than $100,000

WD

=       (TW - 80000) x .04 + $2300.00  
                       PP
x 1.615
More than $100,000

WD

=       (TW - 100000) x .05 + $3100.00 
                       PP
x 1.615
  
PP - the number of pay periods per year
TW - taxable wage
WD - withholding deduction

In order to determine the employee's taxable wage, use the following formula:
TW = (pay per period x PP) - ($650 x number of exemptions)