These days, the majority of mid-to-large employers use payroll service providers for ease of payroll recordkeeping and administration. These third party providers help ease the burden of calculating taxes and withholding, and filing timely returns with state and federal administrative agencies. But while they are increasingly relying on third parties, employers ultimately are responsible for the payment of income tax withheld and the employer and employee portions of Social Security and Medicare taxes, notwithstanding third party negligence or even malfeasance.
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