Estimate payroll taxes refer to the federal, state, and local taxes employers are required to withhold from their employees’ wages. These estimations must be calculated in advance in order to properly determine how much should be withheld from each paycheck. Employers are also responsible for remitting the estimated taxes to the respective government agencies by the due date or risk penalties and interest charges for late payment. Calculating these taxes can seem like a daunting task but it’s essential to keeping your business compliant with tax laws. Keeping accurate records of your employee’s wages, deductions and withholdings will make sure that you stay on top of all relevant payroll taxes.