Payroll tax withholding is a process of taking money out of an employee’s wages in order to pay taxes. This includes income taxes, Social Security taxes, and Medicare taxes. Employers are responsible for collecting and filing these taxes on behalf of their employees. Calculating payroll tax withholding requires employers to keep accurate records and use the appropriate forms, depending on their specific business needs. By setting up a reliable payroll system and conducting regular checks, employers can ensure they are properly calculating payroll tax withholding, avoiding any unpleasant surprises down the line!