W-2 Withholding

[wsbjr]

A company started business in November 2006 with two employees. Three payroll check were paid, but there was no withholding of any taxes. Taxes will be calculated and paid in Jan 2007 for the proper amounts. However, in preparing the W-2's for the employees, should the FICA and Medicare calculated and paid with the 941 be included on the 2006
w-2, or should box 4 and 6 be blank? Still haven't gotten any response from theirs!

[OldJack]

Each paycheck should be "Grossed up" for the amount of FICA and Medicare taxes that is required to be withheld and the W2 would show that the taxes were in fact withheld. The employer is then responsible for paying the withholding amount (W2) plus the employer matching amount on the 941 form.

edit: Basic formula is Gross=Net / (1% - Rate%)

[ChEAr$]

Each paycheck should be "Grossed up" for the amount of FICA and Medicare taxes that is required to be withheld and the W2 would show that the taxes were in fact withheld. The employer is then responsible for paying the withholding amount (W2) plus the employer matching amount on the 941 form.

edit: Basic formula is Gross=Net / (1% - Rate%)

equals Gross / .9235

(grin)

[OldJack]

equals Gross / .9235

(grin)

But .9235 does not work if the employer is required to withhold city, local, or other payroll taxes.