Texas Payroll Tax And Labor Laws

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Texas has no state income tax, as you may know.

When it comes to paying employees and collecting taxes from them, however, companies must keep a few things in mind. This article provides an overview of the following areas connected to Texas payroll services for small businesses in Texas:

Texas Wage and Hour Laws

The Texas minimum wage legislation requires that employees be paid $7.25 per hour.

Except for the following personnel, who are not covered:

• individuals with executive, managerial, or professional responsibilities;
• commission-based outside salespeople and collectors;
• employees in the agriculture industry;
• individuals under the age of 18 who have not completed a vocational or high school education; and
• Students under the age of 20, with the exception of those in agriculture.

Texas Payroll for Employers

Employers subject to the Texas wage payment legislation are required to pay wages at least twice a month. Employees who are exempt from the federal Fair Labor Standards Act’s overtime restrictions, on the other hand, might receive monthly compensation. Paydays must be on the first and 15th days of each month if employers do not specify alternative days.

Except for those explicitly exempted by legislation, all workers are covered, with the exception of independent contractors and some family members.

Texas Unemployment:

Taxable Wage Base ($000s):                        9,000

New Employer Rate (% Taxable Wages)    2.7**

Texas Unemployment Insurance

In Texas, you are responsible for these unemployment taxes if you:

• During each of the 20 weeks of the calendar year, you have at least one employee for a day or part of a day. These weeks don’t have to be in any particular order.
• You paid $1,000 or more for domestic service, $6,250 or more for agricultural or ranch labor, or $1,500 or more for any other labor in a calendar quarter.
  Your company was purchased by you.
• If you had any workers in Texas, you were subject to the Federal Unemployment Tax.
• You hired seasonal employees on a truck, farm, orchard, or vineyard; migrant workers on a farm or ranch; or seasonal workers who did the same job as migrant workers at the same location and time.
• During 20 weeks of the year, you had three or more individuals working on the farm or ranch.

Registering for Unemployment Taxes

You can register for unemployment taxes online with the Texas Workforce Commission. To register, you’ll need the following items:

• Business contact’s email address.
• Payroll data includes things like employee employment history, when wages were initially received, and the amount of your quarterly wage payments.
• Any prior owners’ names.
• For company owners, social security numbers are required.
• Any and all business addresses.
• Knowledge of the company’s goods and/or services is required.

In Texas, the following categories of employers are exempt from paying unemployment insurance taxes:

• Clients/customers of independent contractors.
• Employers who pay less than $1,500 in salaries per year are considered extremely tiny.
• Employees who are exempt.

Texas Income Tax Withholding

Texas, Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Washington, and Wyoming are the only states that do not impose a state income tax.

Texas Benefits

Texas Voting Rights:

Employer Right to Schedule Voting Hours         Unspecified

Pay Deduction for Voting Time Leave                 Prohibited

Employers in Texas are required to provide employees enough time off to vote.

In Texas, all businesses must provide their employees time off to vote. The scope of this overview is limited to private employers.

The quantity of leave time that must be provided is not specified in the law. Employers are not required to provide employees leave time if they have two non-work hours in a row to vote.

How do I report new hires to the state?

• • Report new hires online
  • ENHR Operations Center
    P.O. Box 149224
    Austin, Texas 78714-9224
  • Fax: (800) 732-5015
  • Phone: (800) 850-6442

How do I submit Child Support payments?

• • Remit payments online
  • Texas State Disbursement Unit
    PO Box 659791
    San Antonio, TX
    78265-9791
  • Phone: (855) 853-8286
  • Email: [email protected]

Texas State Tax Resources