Payroll 101

Payroll process has 3 requirements:
1. Payment to employees
2. Pay your taxes
3. File your tax forms e.g. Form 941/944

Payments the company has to make:
1. Employee earnings
2. Employee withholdings
3. Company owed taxes

Note: number 2 and 3 payments have to be made to federal and state governments.

Payments that have to be made to federal and state government include:
1. Employee income taxes
2. Medicare
3. Social security
4. Unemployment taxes

Following forms have to be used to indicate the payment amounts:

Federal (Payment made to US Treasury)
Form 940: Unemployment tax
Form 941/944:
Federal Income Tax
Medicare
Social Security
Advance Earned Income Credit (if applicable)

State (for California - Payment made to EDD)
CA Income tax and Disability Insurance
CA Unemployment Insurance and employment Training tax