Why Isn't the Correct Tax Withheld for My Employee?

Updated February 11, 2025 16:47

Question

Why isn’t the expected tax being withheld from an employee’s paycheck?

Answer

⚠️ We recommend employees consult their accounting professional to clarify withholding expectations. Employees can adjust their withholding by completing Section 4(c) on their W-4.

Employee tax withholding is generally based on several factors:

Their W4 withholdings & filing status: The amount withheld depends on the information provided on the employee’s W-4, including dependents or any exemptions listed.
Minimum income requirements: Tax withholding is triggered once an employee’s earnings meet the minimum threshold for income tax.
Tax rates: Withholdings are based on federal, state, and local tax rates, along with fixed percentages for Social Security (6.2%) and Medicare (1.45%).

Pro Tip! If there are concerns on tax withholdings, you can test this using a third party calculator to verify that the expected taxes match what's being withheld in 7shifts Payroll. Enter the W-4 details and the employee's earnings to compare results!