Income Tax

Glossary \ Payroll Terms

Published On: Thursday July 23, 2020 04:29 AM

Income tax is a tax that only employees pay. There are several taxes that fall into this category: Federal Income tax, state income tax, and local income tax. Federal income tax is paid with FICA as part of federal tax liability. This is calculated by considering taxable compensation on a wage-bracket method but can also be taken as a flat dollar amount or percentage.

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