Since federal income taxes withheld from an employee's wages are expenses of the employee, not the employer, they should not be treated as liabilities of the employer.

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Federal income taxes withheld from an employee's wages are liabilities of the employer because the employer is responsible for remitting these taxes to the government on the employee's behalf. While they may be calculated based on the employee's earnings, it is the employer's responsibility to ensure they are paid.

Since Federal Income Taxes Withheld from an Employee's Wages Are