Expert: Shirley McAllister, CPP, PHR - 8/12/2009

Question
Hello Shirley, My employer made a big error by putting me on a 1099-Misc rather than a W-2. This information was never advise to me as I am working for a temp company as a admin. This employer after  months of me being on a 1099-misc agreed to put me on a W-2 since they did not have the necessary paperwork of me agreeing to be on this in the first place. My question is, When you are on a W-2, the employer takes out your employee taxes. Gross - employee taxes = Net Pay Correct? So why is it that because I am being switched to the correct filing, he is expecting me to pay back the employee and the employer taxes?
If on a W-2, I wouldn't see employer tax amounts on my check stub anyway? Hope this makes sense.
So why am I being subject to pay them if they wouldn't have been taken out of my portion anyway? It is my understanding, and I may be wrong, but when on a w-2 the employer pays his tax and the employee never sees how much that is? Correct me if I am wrong or does employees pay the employer taxes too? thanks in advance

Answer
You only need to pay the employee taxes, not the employer taxes. The Fica and medicare amount is witheld from the employee's check and than it must be matched by the employer and paid by the employer. You do not have to pay the employer part, that is for the employer to do. Also he has to pay the Suta and Futa tax.

What should have been withheld under a W-2 and employer status is

Fica tax
Medicare tax
Federal Withholding tax
State withholding tax

The employer then has to match the Fica and medicare taxes from his own funds. He also pays Futa, Suta and worker's comp from his own funds.

Shirley