Final answer:
Whether you can find a breakdown of employee and employer payroll costs in the Employees center is dependent on the specific system being used. Payroll taxes are shared between employees and employers, with employees typically seeing deductions for Social Security and Medicare on their paychecks. However, economists argue that employers may shift their share of payroll taxes to employees through lower wages, effectively making employees bear the full cost.
Step-by-step explanation:
The statement, 'You can find a breakdown of employee and employer payroll costs in the Employees center.' can be considered true or false depending on the specific accounting or payroll software being used. Generally, in accounting systems, you can usually access detailed reports that provide a breakdown of payroll expenses, including both employee and employer contributions to payroll taxes.
Payroll taxes are composed of deductions from an employee's wages, such as the 6.2% for Social Security and 1.45% for Medicare. Additionally, employers also contribute a matching portion for payroll taxes. However, as some economists suggest, the cost of the employer's share of payroll taxes might be passed on to employees through lower wages, implying that employees may bear the full cost of these taxes indirectly. This nuance in payroll tax burden is particularly relevant when discussing overall compensation and labor economics.
In scenarios where individuals are considered independent contractors, such as in the gig economy, they are responsible for covering both the employee and employer portions of payroll taxes. Understanding how payroll taxes operate and how they are divided between employer and employee is crucial for anyone navigating the workforce.