Example 4-3 To compute the tax using the 2023 Percentage Method for Manual Payroll Systems With Forms W-4 From 2020 or Later

Example 4-3

To compute the tax using the 2023 Percentage Method for Manual Payroll Systems With Forms W-4 From 2020 or Later using Standard Withholding Rate Schedules, follow the steps illustrated below.

Step 1

Determine the amount of gross wages earned, filing status, adjustments on Form W-4, and frequency of pay. Note: If the wage ends in a fractional dollar amount, the wage may be rounded to the nearest dollar. However, in this text, exact wages are used.

Wilson Goodman, single (S), has no adjustments on his Form W-4 and earns $915.60 semimonthly.

Step 2
Determine the withholding tax by referring to the appropriate Percentage Method Withholding Table (see Figure 4.6 below).

Compute tax from Tax Table A, Semimonthly, Standard Withholding Rate Schedule, page T-3.

($915.60 – $577.00 = $338.60 × 10% = $33.86 + $0) = $33.86

Use the 

percentage method

 to compute the federal income taxes to withhold from the wages or salaries of each employee. 
If an amount is zero, enter “0”. If required, round your calculations and final answers to the nearest cent.

As we go to press, the federal income tax rates for 2024 are being determined by budget talks in Washington, and are not available for publication. For this edition, the 2023 federal income tax tables for Manual Systems with Forms W-4 From 2020 or Later with Standard Withholding and 2023 FICA rates have been used.


Click here to access the Percentage Method Tables.


Employee
No.


Employee
  Name


Filing
 Status

No. of Withholding
Allowances


Gross Wage
or Salary

Amount
to Be
Withheld

1

James, A.

MFJ

N/A

$1,610 

weekly

fill in the blank 1 of 4$

2

Lake, R.

S

N/A

825 

biweekly

fill in the blank 2 of 4

3

Walls, S.

MFJ

N/A

925 

semimonthly

fill in the blank 3 of 4

4

Free, Y.

MFJ

N/A

2,875 

monthly

fill in the blank 4 of 4

image1.wmf

Share This Post

Email
WhatsApp
Facebook
Twitter
LinkedIn
Pinterest
Reddit

Order a Similar Paper and get 15% Discount on your First Order

Related Questions

Research Paper Part 1 Post ideas of fraud for approval PART 2 1.

Research Paper Part 1 Post ideas of fraud for approval PART 2 1. Imagine your intent is to make as much money as you can by committing fraud. Give a detailed description of how you would commit this fraud e.g.  individuals, companies and departments involved and impacted by your fraud

see attached  BUSI 675 Application Assignment Instructions Overview

see attached  BUSI 675 Application Assignment Instructions Overview Each application assignment is a comprehensive experiential learning experience and is directly related to business analysis and decision-making. The student will complete four application assignments (4). Instructions Each assignment must be a minimum of 3-5 pages of original discussion and analysis, not

Digital marketing review of the Sparkling Water Industry.  See attached instructions. Digital Marketing and Revenue Project

Digital marketing review of the Sparkling Water Industry.  See attached instructions. Digital Marketing and Revenue Project You will explore eCommerce Marketing through a Google certificate program and explore revenue and sales models. · Consider the Sparkling Water Industry (  https://www.drinkwaterloo.com/,   https://drinkspindrift.com/,   https://www.deerparkwater.com/sparkling-water,   https://www.bubly.com/mix/index.php,   https://www.drinkaha.com/) · Review and analyze the Industry