Frequently Asked Questions

Check out our FAQs

General FAQs

What is withheld from my employee?


Payroll taxes: Social Security, Medicare and all applicable state taxes are withheld from your employees pay each period. Income Taxes should also be withheld in accordance with the employees Form W-4 selections. If no W-4 is on file, the default withholding is Single and 0 deductions.




What is withheld from me as the employer?


Employer’s portion of Social Security and Medicare as well as state and federal unemployment taxes.




What is FICA?


The Social Security & Medicare taxes (collectively known as “FICA”) are waived for both the employer (7.65%) and the employee (7.65%) if the employee earns less than $2,100 in a calendar year. Once the threshold is crossed, FICA tax obligations become effective on the first dollar of wages. For that reason, unless a family is certain wages will remain below the threshold, we advise withholding the employee’s FICA taxes from each paycheck. If the threshold is crossed, the proper tax dollars are already collected for remittance to the IRS. If the threshold is not crossed, the withheld tax dollars are simply returned to the employee.




What is FUTA & SUI?


FUTA is Federal Unemployment Tax Act and SUI is State Unemployment Insurance
FUTA & SUI threshold kicks in as soon as the employer pays a total of $1,000 the quarter collectively across wages paid to all caregivers. Then, once each individual caregiver earns $7,000, they cap out of this tax.




What is a FEIN or EIN?


A Federal Employer Identification Number (FEIN or EIN) is a unique number to you that the IRS assigns. It’s used to identify tax accounts of employers. If you do not have a FEIN we will apply for one on your behalf. If you do have a FEIN, but are unsure of the number, you can find it on a past tax return or call the IRS at 1-800-829-4933 to obtain it.




What do you provide at the end of the year for tax purposes?


In early January (or after your final billing) our finance department will charge an End of Year fee of $100. The $100 fee is for the Year End Package which includes everything you and your employee(s) need to complete your personal tax returns. It’s a flat fee, even if you had multiple employees in the year. Details of what's included - *Form W-2 (Copies B, 2, C) for their employee(s)*Schedule H for taxpayer to attach to their personal income tax return* Form W-2 (Copy A) and form W-3 which we will file on their behalf with the Social Security Administration*State Annual Reconciliation, if applicable, which we will file on their behalf with their state (including Form W-2 (Copy1)





 
 

Taxes FAQs

What is withheld from my employee?


Payroll taxes: Social Security, Medicare and all applicable state taxes are withheld from your employees pay each period. Income Taxes should also be withheld in accordance with the employees Form W-4 selections. If no W-4 is on file, the default withholding is Single and 0 deductions.




What is withheld from me as the employer?


Employer’s portion of Social Security and Medicare as well as state and federal unemployment taxes.




What is FICA?


The Social Security & Medicare taxes (collectively known as “FICA”) are waived for both the employer (7.65%) and the employee (7.65%) if the employee earns less than $2,100 in a calendar year. Once the threshold is crossed, FICA tax obligations become effective on the first dollar of wages. For that reason, unless a family is certain wages will remain below the threshold, we advise withholding the employee’s FICA taxes from each paycheck. If the threshold is crossed, the proper tax dollars are already collected for remittance to the IRS. If the threshold is not crossed, the withheld tax dollars are simply returned to the employee.




What is FUTA & SUI?


FUTA is Federal Unemployment Tax Act and SUI is State Unemployment Insurance
FUTA & SUI threshold kicks in as soon as the employer pays a total of $1,000 the quarter collectively across wages paid to all caregivers. Then, once each individual caregiver earns $7,000, they cap out of this tax.




What is a FEIN or EIN?


A Federal Employer Identification Number (FEIN or EIN) is a unique number to you that the IRS assigns. It’s used to identify tax accounts of employers. If you do not have a FEIN we will apply for one on your behalf. If you do have a FEIN, but are unsure of the number, you can find it on a past tax return or call the IRS at 1-800-829-4933 to obtain it.




What do you provide at the end of the year for tax purposes?


In early January (or after your final billing) our finance department will charge an End of Year fee of $100. The $100 fee is for the Year End Package which includes everything you and your employee(s) need to complete your personal tax returns. It’s a flat fee, even if you had multiple employees in the year. Details of what's included - *Form W-2 (Copies B, 2, C) for their employee(s)*Schedule H for taxpayer to attach to their personal income tax return* Form W-2 (Copy A) and form W-3 which we will file on their behalf with the Social Security Administration*State Annual Reconciliation, if applicable, which we will file on their behalf with their state (including Form W-2 (Copy1)





Unemployment FAQs

If a client has to pay unemployment to a caregiver and the withholding's done throughout the years is not enough to cover the unemployment what happens?


Luckily, this won’t ever be the case. The client pays unemployment insurance to cover him/her if a caregiver is granted benefits, so that payment is covered by his insurance tax (which essentially is working like an insurance premium). Instead, when the state reviews their tax rate each year, they may decide to increase the tax rate if the employer seems more risky to have caregivers file unemployment. The more claims they have, the higher their tax rate (theoretically).




If a brand new client employs a caregiver for 2 weeks and then lets them go, and the caregiver is granted unemployment what happens?


The state accounts for this as well. Each state has a specific minimum amount of time and/or amount of wages and employee has to be with or earn with an employer before they are eligible to be granted benefits. This is usually around 12 weeks but does vary by state. The smallest minimum we’ve ever seen was 4 weeks.




Does the Unemployment office ever bill the client for these wages per se?


Never! Clients do not receive a bill directly. This will always come through their unemployment tax account. If benefits are paid, they may receive statements each quarter called “Benefit Charge Statements” that sometimes look like a bill but are actually just summaries of what benefits were paid out and are for the employers’ records.





 

Home Care Connect

(267) 428-7660   |   info@HomeCareConnectPA.com   |   720 Johnsville Blvd. • Suite 1325 • Warminster, PA 18974

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