Calculating employee payroll taxes is a complex yet necessary task for businesses of all sizes. It involves accurately calculating and filing the various taxes that must be withheld from each individual employee’s paycheck — federal income taxes, Social Security and Medicare taxes, as well as any state or local taxes that may apply. These taxes are calculated using information on the employee’s W-4 form, as well as wage and withholding information that employers must submit to the IRS and other government entities. Properly calculated payroll taxes help ensure compliance with government regulations, in addition to giving employees a more accurate take-home pay.