Dictionary of Accounting Terms: withholding tax
withholding tax
deductions by an employer from employee salaries for the payment of federal and state income taxes. It is paid in a prescribed manner to the taxing authority. Withholding tax is remitted by the employer to the IRS or deposited into the designated bank on a periodic basis as prescribed by the IRS.
Dictionary of Business Terms: withholding tax
withholding tax
amount of income taxes that an employer is required to withhold from an employee's salary when the salary is paid. The amount withheld is a credit against the amount of income taxes the employee must pay on his income earned for the taxable year.
