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Doing Business Guide.
Employment Taxes
Employment taxes apply to both the employer and the employee. Employees have federal and state income tax contributions withheld from their pay based on allowances. Additionally, social security and Medicare contributions are withheld from the employee. A portion of the employee's mandatory disability insurance may be withheld from the employee as well. The employer must contribute an equal amount of social security and Medicare payments and remit this along with the federal withholdings to the federal government. An employer is also required to provide worker's compensation, disability insurance, and federal (FUTA) and state (SUTA) unemployment insurance for employees, which are forms of taxes.