Connecticut Hourly Paycheck Calculator
Are you scouring the Internet for information on payroll taxes for Connecticut? We understand that finding what you need can be a daunting process. We’ve compiled this handy guide to fast-track your search.
Below, you’ll find a summary of the common payroll taxes in Connecticut, so you have an idea of what is involved. If you’d rather have someone else do it, qualified accountants and payroll software are available to take command.
Payroll taxes in Connecticut
Figuring out withholding taxes in Connecticut starts with state income tax, which all residents must pay. Non-residents working in Connecticut must also pay Connecticut income taxes.
Connecticut income tax withholding
Like most states, Connecticut uses a progressive income tax system ranging from 3.00% to 6.99%. These rates apply to all filers, regardless of filing status.
To compute the amount of tax to withhold from employees’ pay, use Form CT-W4 Employee’s Withholding Certificate. Withholding depends mainly on the employee’s filing status, taxable income, and military status.
Your employees should complete federal Form W-4, Employee’s Withholding Certificate and Form CT-W4 before they start working for you. For employees who don’t provide you with a Form CT-W4, withhold taxes at the highest rate of 6.99%.
Although a new Form CT-W4 isn’t required each year, if an employee’s circumstances change where they may owe more tax, they should complete a new form within ten days of the change.
Filing and paying Connecticut withholding tax
You may have to pay weekly, monthly, or quarterly, depending on your filing frequency. Unless you have a waiver from the Department of Revenue Services, you must file withholding returns and remit withholding payments electronically.
Each time you make a payment, you’ll electronically complete Form CT-WH, Connecticut Withholding Tax Payment.
Regardless of your payment frequency, all employers must file quarterly summary reports using Form CT-941, Connecticut Quarterly Reconciliation of Withholding.
Quarterly returns are due the last day of the month following the quarter’s end. You must file a return even if no tax was withheld. And if you have no tax to pay? You still have to file a return.
In addition to quarterly returns, you will need to file a Connecticut Annual Reconciliation of Withholding, Form CT-W3. The annual return is due by January 31, and you’ll need to send copies of your federal Form W-2, Wage and Tax Statement, for all employees. If January 31 falls on a weekend, filing on the next business day is considered timely.
Connecticut unemployment insurance
In Connecticut, the first $15,000 of each employee’s wages are subject to unemployment insurance each year.
Unemployment insurance rates for new employers are 3.0% until they receive an experience rating based upon how they use the unemployment system. Experience rates can be anywhere from 1.9% to 6.8% per year.
State unemployment taxes are filed and paid quarterly and are due within 30 days after the quarter ends. With few exceptions, they must be filed and paid electronically.
Federal payroll taxes
Connecticut employers and employees each pay different types of federal payroll taxes. There are four federal payroll taxes you’ll need to collect and pay.
- Additional Medicare tax
- Federal income tax
- Federal unemployment tax
Taxes paid by the employer and employee:
- Social Security and Medicare tax
Federal income tax
Use Form W-4 to calculate the amount of federal income taxes to withhold from your employees’ paychecks. Have your employees complete this form before hiring them and anytime they have changes that could influence the tax they may owe.
Use the information on Form W-4 and tax tables so you can calculate how much to take out. To make it easier, payroll software can help with the math by making the calculations for you.
Keep the Form W-4 in your payroll files—no need to send them to the IRS.
Social Security and Medicare tax
The Federal Insurance Contributions Act, or FICA tax, is made up of the Medicare tax and the Social Security tax. In 2022, the Social Security tax requires employers and employees to each contribute 6.2% of wages up to $147,000. The Medicare tax requires each to contribute 1.45% of all wages. See the IRS webpage for details, like maximum thresholds.
Federal unemployment tax
Like the state, the federal government also has an unemployment tax. It’s called FUTA and it’s an annual tax employers pay on the first $7,000 of each employee’s wages. The FUTA rate for 2022 is 6%, but most employers only have to pay 0.6% each year.
Additional Medicare tax
You may have employees who owe the Additional Medicare tax. Whether an employee owes this tax depends on their tax filing status and their taxable income. But as an employer, you’re required to withhold this tax on anyone earning more than $200,000 per year. You’ll withhold 0.9% on the wages over $200,000.
Filing and paying Federal payroll taxes
Depending on how much you owe, send the withheld taxes and your portion of FICA to the IRS either monthly or semi-weekly. Each quarter you will need to complete a summary report with Form 941, Employer’s Quarterly Federal Tax Return.
For federal unemployment tax, if you owe more than $500, you’ll pay quarterly. If your tax is less than $500 a year, pay the tax when you complete your annual summary report with Form 940, Employer’s Annual Federal Unemployment Tax Return.
Other Connecticut paycheck laws
Here are some other paycheck laws in Connecticut you should know about.
- New hires: Employers must report new or rehired employees within 20 days of hire to the state.
- Minimum wage: Minimum wage in Connecticut is:
|Connecticut Minimum Wage|
|Effective Date||Minimum Wage|
|July 1, 2022||$14.00 / hour|
|July 1, 2023||$15.00 / hour|
Starting on January 1, 2024, the minimum will be adjusted for economic indicators.
- Final paychecks: When an employee quits, pay them their final wages by the next regular payday. If you let an employee go, pay them the next business day.
- Overtime: Hourly employees working more than 40 hours in a week must be paid overtime at 1 ½ times their regular pay rate for hours worked over 40.
- Workers’ Compensation insurance: Requirements to obtain Workers’ Compensation vary by state. This table outlines some of these requirements. If you determine that your company is required to purchase Workers’ Compensation insurance in your state, learn how to sign up for this insurance with Gusto. Sometimes, companies get a request for a workers’ comp audit—head to this article and click the workers’ comp audit reports dropdown for more information.
- Paid sick leave: Employers with 50 or more employees must provide each employee with at least one hour of paid sick leave for every 40 hours worked.
- Jury duty: Employers must pay full-time employees regular wages for the first five days of jury service.
You can quickly get started with Gusto’s Connecticut Hourly Paycheck Calculator. With just a few clicks, you’ll see how easy it is to calculate your payroll taxes accurately.