Payroll Tax

Description and Definition of Payroll Tax

A tax based on wages, tips, and salaries paid. Your employer deducts a certain amount from your paycheck and pays the rest of these taxes. This tax money funds many finance specific programs. Federal, state, and local governments collect payroll taxes for expenses such as Social Security, Medicare, unemployment compensation, and worker's compensation insurance.

Resources

See Also

Further Reading

• Payroll Tax in the West's Tax Law Dictionary
• Payroll Tax in “A Dictionary of Taxation”