The answer is liability but why is it a liability but not an expense
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The answer is liability but why is it a liability but not an expense
An employer witholds taxes from an employee like FICA, FIT, Social Security, State and Local taxes, and so on. The taxes that are withheld from an employee is not an expense to an employer, but they are a liability because the employer has to submit the taxes on behalf on its employees usually on a monthly or quarterly basis.
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