Payroll Taxes Definition

Payroll taxes are amounts withheld from employees’ wages and contributed by employers and paid by employers to the federal government.

Payroll Taxes Extended Definition
Payroll taxes include the portion of funds held out of an employee’s wages for Medicare, Social Security, and federal income taxes. Employers also match Medicare and Social Security taxes for each employee.

Payroll taxes are usually paid on a quarterly basis, but some small businesses pay annually.