Many small businesses use some sort of payroll tax program to help them calculate, file and pay federal payroll taxes. There are many developers of these such programs, and most of them do a good job of accurately calculating withholding tax rates and helping with filing and reporting payroll taxes.
Popular Payroll Tax Programs
There are many developers of payroll tax software, but a few developers stand out amongst the others. Software applications like Microsoft Office Accounting, Peachtree Accounting and QuickBooks all offer a payroll tax module option. All of these programs offer you the ability to calculate payroll tax withholding deductions, file payroll tax reports, and even make online payroll tax payments. In addition, these applications also allow you to download updates that reflect changes in the tables used by the IRS for determining how much to withhold from employee paychecks.
If you're just starting your small business, and don't yet have a lot of spendable cash, you can also try open source offerings such as GNUCash. GNUCash is a very popular, free accounting software that has a payroll module available and is considered to be quite good by many professional accountants. While the open-source product does have many powerful features, it is considered to be lacking in areas like ease-of-use and a friendly user interface.

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