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Payroll Tax Responsibilities

Tax and Wage Reporting

If you have employees, you are responsible for several Federal, State and Local Taxes. Some of these taxes apply to the Employers, Some are levied upon the Employee, and Some Apply to both Employers and Employees.

Employment Taxes are: 

  • Federal Income Tax (FITW)
  • State Income & Locality  Tax (SITW)
  • Social Security & Medicare (FICA)
  • Federal Unemployment Taxes (FUTA)
  • State Unemployment Taxes (SUTA)

As a business, you are responsible for timely Payments & Deposits of: Employment Taxes withheld from Employees,  Employers matching share of Social Security and Medical Taxes, and any Federal and/or State Unemployment Tax.

The Employer’s share of the Social Security, Medicare,a dn ALL FUTA tax deposits are deductible. Be CAREFUL; only deduct the Employer’s share of the Social Security & medicare Taxes. DO NOT deduct Gross Wages (Pre-Tax Wages) plus the Employee’s share of Social Security & Medicare Taxes; that would be considered double deducting of Social Security & Medicare Taxes.

Either deduct, Gross Wages plus the Employer’s Share of FICA taxes, or Net Wages Plus ALL Payments for FICA Taxes.  

Important Reminders:

  • Form 940 & Form 941 may now be filed electronically
  • You MUST make Electronic Deposits for Federal related taxes via EFTPS
  • When hiring New Employees, Employers MUST verify that they are Legally Eligible to work in the U.S. by completing Form I-9. Employers are also required to report any NEW hires to the State with a copy of the Form W-4.
  • Required Taxes must be Withheld from EACH paycheck or Unemployment Compensation.

Calendar of Employer Responsibilities:

New Employers: 

  • Verify work eligibility of New Employees
  • Obtain & Record Employees Name, DOB, and Social Security Number
  • Highly recommend making a photo copy of a Valid ID (License, Passport, State ID) & Social Security Card
  • Ask Employee’s to Complete a Form W-4 and Form  HW-4 (State of Hawaii Employees)

Each Payday:

  • Withhold Federal Income Tax & State Income Tax based on each Employees Form W-4 and State Withholding Form (HW-4 for State of Hawaii)
  • Withhold Employees share of FICA Taxes
  • Deposits: 
    • Withheld Income Tax
    • Withheld & Employers share of FICA Taxes

** Due DATES of your deposits depend on your Deposit Schedule (Semi-Monthly or Monthly)

Quarterly: (By 1Q April 30, 2Q: July 31, 3Q: October 31, 4Q: January 31 of the preceding year)

  • Deposit FUTA Taxes via EFTPS
  • File Form 941 (Pay Taxes with Quarterly Return if you are NOT required to Deposits)
  • File State Unemployment

Annually:

  • Remind Employees to Submit a NEW Form W-4/HW-4, if they need to make changes to their withholding
  • Ask for a NEW Form W-4/HW-4 from employees claiming EXEMPT from Federal Income Tax/ State Income Tax.
  • Reconcile Forms 941 with Forms W-2 and W-3
  • Furnish Each Employee with a Form W-2 by January 31 of the Preceding Year
  • File Copy A of Form W-2 and the Transmittal Form W-3 with the Social Security Administration (SSA)
  • Furnish each Independent Contractor with a Form 1099
  • File Forms 1099 & 1096
  • File Form 940 or Form 940EZ
  • File Form 945 for any Non-Payroll Income Tax Withholding
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Hawaii Payroll Services

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