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To: Beave Meister
Workers making $30,000 will take a bigger hit on their pay than those earning $500,000 under the fiscal cliff deal.

how is that possible ?
26 posted on 01/08/2013 4:30:28 AM PST by stylin19a (Obama - Fredo smart)
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To: stylin19a
how is that possible ?

Because the "payroll tax holiday" ended as of January 1. This increases the FICA taxes back to their full amount (as opposed to a temporary 2% cut) for people earning up to the Social Security threshold (just under $100,000, I believe). There are no deductions, exemptions, deferrals, or loopholes to avoid FICA taxes on regular income, so someone making $30,000 is going to have an absolute tax increase of 2% of their gross pay.

For the person making over $400,000, their marginal tax rate may be going up, but unless they find themselves without the means of taking advantage of deductions, et. al., it's unlikely that their effective tax rate will rise by 2% or more, even including the FICA increase on the first $100k or so.

27 posted on 01/08/2013 4:39:01 AM PST by kevkrom (If a wise man has an argument with a foolish man, the fool only rages or laughs...)
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