Delaware Salary Paycheck Calculator
Delaware may be one of the smallest states in the country, but that doesn’t mean it’s small on payroll taxes and paycheck rules. If you’re a small business owner looking for answers on these topics, you’ve come to the right place. We’ve curated and answered the most common questions to help get you on your way.
Delaware state payroll taxes—and other rules
What’s the salary threshold in Delaware?
Because the state of Delaware doesn’t have its own salary threshold, it adheres to the federal salary threshold, which is now $684 per week (equivalent to $35,568 per year for a full-year worker). The Department of Labor permits employers to count some bonuses, commissions, and other incentive payments toward meeting the standard salary level (up to 10%). Employees who earn at least $107,432 per year may qualify as “highly compensated.” See this Department of Labor fact sheet for details.
Do new employees need to be reported?
When is a Delaware employer required to have 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.
When employees leave, when are final paychecks due?
Whether an employee resigns or is terminated or laid off, you must pay their final wages no later than the next regularly scheduled payday.
How is Delaware’s unemployment tax calculated?
Delaware employers pay unemployment tax that’s used to provide financial aid to unemployed workers. For 2022, unemployment tax is charged on the first $14,500 of each employee’s wages each year. Most employers pay unemployment tax rates between 0.3% and 8.2%. If you’re a new business, you’ll pay a 1.8% rate.
Employers pay the unemployment tax each quarter and file a report using Form UC-8, Employer’s Summary Assessment Report. The report is required even in months when no wages were paid, or no tax is due.
If you want to learn more about Delaware’s unemployment tax, you can take a look at their employer handbook. It’s a comprehensive guide explaining employers’ responsibilities for unemployment tax.
How do employers calculate the amount of Delaware state income tax to take out of workers’ paychecks?
Residents and some non-residents need to have Delaware income tax withheld from their paychecks to pay their annual tax bill. The amount of tax withheld depends partially on federal Form W-4, Employee’s Withholding Certificate. Information like tax filing status and the number of dependents impact the amount of tax withheld.
With this information, you can use Delaware’s tax tables or formulas to figure out how much tax to withhold. The amount of tax you withhold in a year determines how often you pay. Payment frequencies can be:
- Eighth monthly (up to eight times a month)
Payroll reports are also required.
|Delaware Payroll Tax Returns|
|Payment frequency||Payroll Tax Return|
|Quarterly||File Form W-1Q each quarter|
|Monthly||File Form W-1 each month|
|Eighth monthly||File Form W-1A each withholding period|
All employers need to file an annual reconciliation using Form W3, Annual Reconciliation of DE Income Tax Withheld, and send copies of Form W-2 to the Delaware Division of Revenue by the last day of January.
Federal payroll taxes
If employers pay state unemployment tax, are they required to pay federal unemployment tax?
Yes. 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 many employers only have to pay 0.6% each year.
How is FICA tax calculated?
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.
Which employees need to pay the Additional Medicare tax?
Not all employees need to pay the Additional Medicare tax. It depends on their annual taxable income and tax filing status.
As an employer, you’ll need to withhold this tax from any worker who earns more than $200,000 a year. The 2022 tax rate is 0.9% on the excess wages.
How do employers know how much federal income tax to withhold from employees’ paychecks?
Figuring out how much federal income tax to take out of employees’ paychecks depends on a few factors, like wages, tax filing status, and the number of dependents.
First you’ll need to get Form W-4, Employee’s Withholding Certificate, from your employees when they start working for you. All employees, even those who are exempt from withholding, should complete this form. Although a new document isn’t required each year, it’s a good idea to have employees review it annually and update it if their tax situation changes.
You’ll use this information along with federal tax tables to determine how much tax to take out. Fortunately, payroll software makes this easy. With only a few clicks, you have the tax calculations at your fingertips.
How often are federal payroll taxes paid?
How often you’ll pay your federal payroll taxes depends on how much tax you owe.
|Federal Payroll Tax Payment Frequency|
|Tax Type||Payment Frequency|
|FICA||Monthly, semi-weekly, or next day|
|Federal income tax withholding||Monthly, semi-weekly, or next day|
|Additional Medicare tax||Monthly, semi-weekly, or next day|
|Federal unemployment tax||Annually or quarterly|
Along with paying your federal payroll taxes, you’ll also need to file payroll tax returns.
- Form 941, Employer’s Quarterly Federal Tax Return
- Used for:
- Federal income tax withholding
- Additional Medicare tax
- Used for:
- Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return
- Used for:
- Federal unemployment tax
- Used for:
That’s Delaware payroll taxes and paycheck rules in a nutshell. If keeping track of filing deadlines and tax rates isn’t your cup of tea, we understand. Comprehensive payroll providers can take care of everything from tracking your employees’ timesheets to paying and filing your payroll tax returns.