Thread: payroll taxes

I have a client that has his ex-wife as an employee. Every once in a while he wants to pay her an additional check. Instead of using the payroll service., I do a manual check and list it with the payroll service for payroll tax purposes only. Now he does not want to pay his portion of taxes on that check. What is the best way in the future to handle these additional payments to her, so she can pay her own taxes?

Thanks for the help.

pjean

Originally Posted by ZahiD

As an employer, share of your client is 50% of FICA (Medicare and Social Security) which is currently 6.2%. He has to pay that whether he likes it or not. The other 50% is the responsibility of the employee and is deducted from her paycheck.

Am I understanding this right? Is your employer trying to avoid paying 6.2% ?

Hi Zahid,

I am thinking that this additional check to her is not supposed to be a payroll check.. He mentioned at one time about getting some money from sale of investments and then distributing funds to her. I really don't know how to show this type of transaction on the books. He tells me she is not a partner in the business, she is an employee. I know it would be a draw from his capital account, but what account would I use for the income part to her. Don't think this transaction can be done. Any thoughts?

Thanks.

pjean