Everything You Should Know About Georgia Payroll Taxes

There are many exciting parts of being a business owner: growing your vision, cultivating a culture, working with customers, and, of course, making money. For most of us, filing payroll taxes is not one of those things.

As a Georgia business owner, this likely comes as no surprise. GA Payroll taxes not only impact the bottom line, but are a difficult and confusing endeavor, especially for new employers. Still, it is your obligation to understand, file, and pay all GA payroll taxes related to your company at the appropriate time – otherwise, you could face the risk of legal repercussions.

Luckily, our team is here to help. In this article we will explore the required Georgia payroll taxes your company is expected to pay, as well as the key forms you must file.

Contents:

• Types of Georgia Payroll Taxes
• State Tax Forms
• Federal Tax Forms
• Your Payroll Tax Experts

Types of Georgia Payroll Taxes

As a business owner in Georgia, you are responsible for filing payroll taxes on the state and federal level. State and federal level taxes are consistent for nearly all Georgia businesses.

In this section, we will examine the primary federal and state payroll taxes every Georgia employer is responsible for.

FICA and Employment Taxes

The Federal Insurance Contributions Act (FICA) requires all employers to deduct federal taxes from every paycheck on their payroll. Unlike individual taxes, the IRS requires payment from both employees and employers – typically at a rate of 7.65% of taxable wages.

In practice, FICA taxes serve as the primary funding source for the Social Security program, which provides retirement, disability, and survivor benefits to eligible participants. The federal tax also helps fund Medicare, a government-led national insurance program. Technically, the 7.65% tax rate is a combination of both program’s tax rates – 6.2% to Social Security, 1.45% to Medicare.

Unless defined in IRC section 3121(a), all forms of payment (cash, check, deposit, etc.) are considered taxable wages. This rule also applies to base pay, whether hourly, weekly, piecework, or another arrangement.

Of course, there are a few forms of payment that are not included in FICA’s policies and thus are exempt from taxation. These exemptions include:

• Wages paid to disabled employees that collect Social Security disability insurance benefits
• Wages paid following an employee’s death
• Retirement contributions by an employer
• Expense reimbursements for driven mileage.

Every year, the Social Security Administration (SSA) establishes a maximum taxable wage for FICA. In 2022, the maximum taxable wage is $147,000, an incremental raise from the $142,800 cap in 2021. In 2023, the maximum taxable wage is expected to be $160,2000.

Federal Withholding

In the US, every employer is required to withhold income from each of their employee’s wages and earnings. 

The amount of money withheld from each employee’s paycheck will differ depending on the amount they earned and the information supplied on their W-4 form. In order to estimate how much should be withheld from each employee’s paycheck, employers should use the IRS’s withholding tables. Employers can also use the Income Tax Withholding Assistant, available on the IRS’s website. 

Along with their wages, employers should withhold income from their employee’s nonresident distributions, pension and annuity payments, and similar sources of income.

For more information, visit the Internal Revenue Service.

State Withholding

In Georgia, employers are typically expected to withhold 5.75% of taxable wages from each employee’s pay. Taxed wages are paid directly to the state by the employer on behalf of their employees.

Per the Georgia Department of Revenue, taxes should be withheld from the following:

• Wages
• Nonresident distributions
• Pension and annuity payments
• Other sources of income

While there is a standard rate, state withholding tax rate does exist on a graduated scale, largely impacting bonuses and other forms of compensation. As a result, employers should use each employee’s Form G-4 and the withholding tax tables in the Georgia Employer’s Tax Guide to estimate the withholding rate for each paycheck.

For more information, visit the Georgia Department of Labor. 

Note: there is no local income tax in the state of Georgia.

Unemployment Insurance Taxes

Unemployment insurance provides financial aid to eligible GA payroll workers while they seek new employment opportunities. Typically, unemployment insurance is issued at the state level, though the federal government can administer it  during periods of crisis – like the COVID-19 pandemic.

Like most other social programs, unemployment insurance is funded by tax contributions, otherwise known as an “Unemployment Tax.” All businesses must contribute to the state unemployment insurance fund through their taxes. 

In regards to Unemployment Tax, the following rules apply for Georgia-based employers:

• Every employer in Georgia must create a Georgia UI tax account with the Georgia Department of Labor. 
• For-profit employers are liable for Georgia Unemployment Taxes after paying $1,500 in wages in a single calendar quarter OR employing at least one person for more than 20 weeks in a calendar quarter.
• Acquisitions of other businesses (or 90% ownership) are liable for Georgia Unemployment Insurance Taxes.
• Georgia employers are liable for additional federal unemployment taxes under the Federal Unemployment Insurance Tax (FUTA). 

In 2022, the Georgia state unemployment insurance (SUI) tax rate is 2.7% for new businesses, with the maximum taxable wage base set at $9,500. For established businesses, rates are based upon “experience rating” – outlined by the Georgia Department of Labor.

On a federal level, the Employer’s Annual Federal Unemployment (FUTA) tax rate is 6.0%, applied to the first $7,000 paid to each employee’s wages during the year.

Note: GA payroll employers are required to post a notice regarding state unemployment claims in a common space for all employees to see, typically using a poster.

Payroll Tax Forms for Georgia Employers

Of course, in order to pay taxes in the state of Georgia, you must properly file and submit the appropriate tax forms on both the state and federal level. While all forms are listed on government websites, the lists can be daunting and confusing.

In this section, we will review the most common Georgia payroll forms that employers should expect to file on a routine basis. 

Note: For an exhaustive list of state and federal payroll tax forms, please visit our comprehensive Georgia Payroll Tax Guide.

State Forms

Form DOL-1A

By state law, all businesses (other than the government) that employ individuals are required to file Form DOL-1A, Employer Status Report. Employers must file this report regardless of how long their business employs workers.

Form DOL-1A provides the Georgia Department of Labor with key information to make a determination of an employment unit’s liability or non-liability. Among other details, this includes the company’s location and business type. Along with establishing liability, the form also establishes an unemployment insurance tax account in the state.

In Georgia, the Employer Status Report is a mandatory document that employers must file during the calendar year – established by OCGA Section 34-8-121. A business owner must submit Form DOL-1A the first time individuals are hired for a service, when another entity acquires the business, or upon request. An inability to submit the report, as well as false statements, is punishable as a crime. 

Form G-4

Outside of the Employer Status Report, the first form every Georgia-based employer needs is Form G-4, Employee Withholding. Like the federal Form W-4, employers must have their employees fill out Form G-4 in order to determine their business’s state payroll taxes. Each individual employee’s withholding allowance certificate is used to determine how much of their paycheck is withheld by their employer.

All instructions are listed directly on the form, including a worksheet for calculating additional allowances. On the form itself, employees are required to submit the following information:

• Full name
• Current address
• Social Security Number
• Marital status
• Dependent allowances
• Additional allowances
• Additional withholdings

As an GA payroll employer, you must have an updated G-4 for each employee every year. In the case that employees fail to submit Form G-4, the employer must withhold income tax as if the employee has zero allowances.

Form GA-V

In the state of Georgia, employers must submit and pay withholding taxes on a monthly and quarterly basis. The deposit frequency for each employer is dependent on the size of their company’s payroll tax liability, and can change if their taxes increase.

For monthly payments on withheld taxes, employers must submit Form GA-V, Withholding Monthly Payment Voucher. When submitting Form GA-V, taxes are withheld when wages are paid instead of when a pay period ends. 

Georgia business owners must submit Form GA-V and their monthly payments on or before the 15th of the following month. If the 15th of the month is a holiday or weekend, then the due date is the next business day. In the case that payment is after the monthly deadline, employers may be subjected to late charges.

In order to submit their monthly voucher, employers should send their completed form and payment to:

• Processing Center
  Georgia Department of Revenue
  PO Box 105544
  Atlanta, Georgia 30348-5544

In the case an employer withholds more than $500 in a single return, they must submit payments via Electronic Fund Transfer (EFT). Form GA-V is not required if taxes are paid by EFT.

Form G-7

Like how Form GA-V is used for monthly filings, Form G-7 is used for submitting and paying withheld taxes on a quarterly basis.

To file a quarterly return, Georgia business owners should use Form G-7, Quarterly Return for the Quarterly Payer. In order to properly fill out Form G-7, employers must use their employees’ completed Form G-4s.

Employers must submit Form G-7 on a quarterly basis, even if no tax was withheld for the particular period. Specifically, Form G-7 needs to be submitted on or before the last day of the month that follows the quarter. If the due date falls on a weekend or holiday, the form must be submitted on the next business day. For 2022, the following dates are the deadline for Form G-7 submissions:

• Q1 (January-March): 5/02/2022
• Q2 (April-June): 8/01/2022
• Q3 (July-September): 10/31/2022
• Q4 (October-December): 1/13/2023

For 2023, the following dates are the deadline to Form G-7:

• Q1 (January-March): 5/01/2023
• Q2 (April-June): 7/31/2023
• Q3 (July-September): 10/31/2023
• Q4 (October-December): 1/17/2024

Employers who submit Form G-7 after the return date will potentially face a late fee. Generally, late returns receive a penalty equal to $25 plus 5% of the total quarterly tax withheld for each month the return is late – capped at $25 plus 25% of total tax withheld on the return.

When submitting a Form G-7, employers must include payment for quarterly withheld taxes. Generally, employers complete Form G-7 digitally through the Georgia Tax Center.

The form and payment can also be mailed to:

• Processing Center
  Georgia Department of Revenue
  PO Box 105544
  Atlanta, Georgia 30348-5544

Note: Payers should not file Form G-7 for each payment. Monthly payments must be submitted with Form GA-V, while nonresident withholding must use G-7 NRW. G-7 should only be filed at the end of each quarter.

Form DOL-4N

Similar to Form-G7, employers in the state of Georgia are required to complete Form DOL-4N, Employer’s Quarterly Tax and Wage Report. The form is used to notify the Department of Labor about the wages paid to employees during a given quarter.

Using the information on Form DOL-4N, employers can calculate how much they owe in taxes to comply with unemployment insurance requirements. Taxable wages are capped at $9,500 per employee per calendar year.

Like Form G-7, the Employer's Quarterly Tax and Wage Report is due the last day of the month that follows the quarter, with exceptions for holidays and weekends. Quarterly returns for 2022 are due:

• Q1 (January-March): 5/02/2022
• Q2 (April-June): 8/01/2022
• Q3 (July-September): 10/31/2022
• Q4 (October-December): 1/13/2023

The form and payment can be mailed to:

• Georgia Department of Labor
  PO Box 740234, 
  Atlanta, Georgia 30374-0234

Federal Forms

Form W-4 

Like with the state, employers are required to have their employees complete an Employee’s Withholding Certificate on the federal level. This is done by completing Form W-4.

As the business owner, an employee’s Form W-4 will tell you the individual’s filing status, multiple job adjustments, amount of tax credits, income, deductions, and additional withholdings. The information on Form W-4 is used to compute the amount of federal income tax deducted and withheld from each employee’s pay. In the case that an employee fails to submit a Form W-4, you must withhold federal income taxes as a single filer’s deduction with no other entries.

An employee is entitled to change the entries on their Form W-4 when their financial or personal situation changes. As the business owner, you are required to put the changes into effect by the start of the first payroll period – on or after the 30th day from the date the revision was received. 

Form W-2 

Used in conjunction with Form W-4, Form W-2, Wage and Tax Statement, is used to report withheld Federal Insurance Contributions Act (FICA) taxes for employees on an annual basis. These FICA taxes include Medicare and Social Security taxes.

Every employer is required to submit a Form W-2 if they pay individuals in exchange for a service, including non-cash payments of $600 or more in a single year.

While employees submit information via Form W-4, employers are ultimately responsible for filing Form W-2 and paying the withheld taxes. The deadline for annual submissions is January 31st, or the next business day in the case of holiday or weekends. Form W-2 may be submitted electronically on the Social Security Administration’s Employer W-2 Filing Instructions and Information webpage.

Form 940

Employers should use Form 940 to report their annual Federal Unemployment Tax Act (FUTA) tax. For 2022, the Employer’s Annual Federal Unemployment (FUTA) tax rate is 6.0%, applied to the first $7,000 paid to each employee’s wages during the year. 

According to Form 940’s instructions, a typical employer must file if:

• They paid wages of $1,500 or more to employees in any calendar quarter during the taxed year.
• Had one or more employees for at least some part of a day in any 20 or more different weeks in the taxed year.
• They meet additional requirements for household and agricultural employees, tax-exempt organizations, or local/state governments.

Form 940 and its related tax payment must be submitted to the IRS by January 31st, 2023. Employers are encouraged to submit their forms electronically, and are required to submit their tax deposit via Electronic Funds Transfer.

Form 941

Similar to W-2, Form 941 is used to report income taxes and FICA taxes withheld from employee paychecks – although Form 941 is submitted quarterly.

Like state forms, the Employer’s Quarterly Federal Tax Return is due at the end of the month following the end of the quarter. Specifically, quarterly returns for 2022 are due:

• Q1 (January-March): 5/02/2022
• Q2 (April-June): 8/01/2022
• Q3 (July-September): 10/31/2022
• Q4 (October-December): 1/13/2023

Payments should be made with Form 941-V, Payment Voucher. In order to avoid penalties, payment should only be submitted if:

• Total taxes after adjustments and nonrefundable credits for either the current or preceding quarter are less than $2,500
• There was no incurrence of a $100,000 next-day deposit obligation during the current quarter
• Payment is being made in full with timely return
• The employer is a monthly schedule depositor, in accordance with the Accuracy of Deposits Rule.

In the case that you do not fit these requirements, payment should be made via EFT.

Your Payroll Tax Experts

Of course, even after reading this blog post and our extensive guide, Georgia payroll taxes can still be an overwhelming endeavor. Whether it be confusion over which forms to file, how to calculate withholdings, how to submit payment, or even the form’s language, we understand that managing your Georgia payroll alone can be stressful.

Thankfully, our expert Payroll Guides are ready and waiting to assist and provide Georgia payroll services to your business – right from our Atlanta office!

Our all-in-one payroll service not only includes a premium software, but an expert-led concierge service. Our Payroll Guides are knowledgeable in all local, state, and federal payroll guidelines for Georgia-based businesses, allowing them to provide the support you need. Even better, they also take the time to learn how your business operates in order to help you grow.

Along with ensuring all forms are properly submitted, our team will also search for and acquire tax credits, including the Employee Retention Credit and Work Opportunities Tax Credit. When it comes to filing taxes and finding breaks, our team leaves no stone unturned. We are one of the top payroll companies in Georgia.

DISCLAIMER: The information provided herein does not constitute the provision of legal advice, tax advice, accounting services or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional legal, tax, accounting, or other professional advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation and for your particular state(s) of operation.