Posted on 05/25/2011 7:07:30 AM PDT by KeyLargo
SmartMoney.com
THE TAX GUY MAY 25, 2011
Just What You Needed: Higher Taxes
The often-overlooked Social Security tax is expected to start rising again next year.
ByBILL BISCHOFF
While you hear a lot about the federal income tax, you don't hear much about the Social Security tax. That's odd because for many folks especially the self-employed Social Security tax can be the bigger hit. Here are some little-known truths about how the Social Security tax works and how much it can amount to.
As an employee, your wages are hit with the 12.4% Social Security tax up to the annual wage ceiling. Half the Social Security tax bill (equal to 6.2%) is withheld from your paychecks. The other half is paid by your employer. Unless you understand how the tax works and closely examine your pay stubs, you may be blissfully unaware of how much the Social Security tax actually costs potentially a lot.
The Social Security tax wage ceiling for both 2010 and 2011 is $106,800. If you made that much or more last year, the Social Security tax hit on your 2010 wages was a whopping $13,243 (12.4% x $106,800). Half came out of your paycheck. Your employer paid the other half.
For 2011, the tax hit is less, thanks to a one-year 2 percentage-point reduction in the Social Security tax withholding rate on wages -- from the normal 6.2% to 4.2% (your employer's 6.2% rate is unchanged). For 2012 and beyond, however, Social Security tax withholding on your wages will jump back to the standard 6.2% rate.
While many employees may not realize the magnitude of the Social Security tax, self-employed folks know it all too well. That's because the self-employed must pay the entire 12.4% tax rate out of their own pockets, ...
(Excerpt) Read more at smartmoney.com ...
This article clearly shows why we must elect a conservative to the presidency in 2012, and achieve a conservative majority in the Senate.
Your forgetting the house.
I didn't forget it; we've already got the House. I suppose I could have said we need to keep it.
Bill Bishoff is one of a very few in the media to advocate for lower taxes.
http://www.smartmoney.com/taxes/income/the-road-to-tax-reform-starts-here/
Think You’re Estate-Tax Exempt? Maybe Not
http://blogs.smartmoney.com/tax/2011/02/17/think-youre-estate-tax-exempt-maybe-not/
Republicans have the house. not conservatives. Just look at the speaker.
It’s gonna happen. There is simply no political will to deal with the problem any other way.
“Republicans have the house...not conservatives.
Just look at the speaker.”
You make an excellent point. Speaker Bonehead must be replaced...Michelle Bachman would be a great Speaker of the House.
Your?
Sorry. You’re. Now can we get back to the topic at hand and stop nitpicking?
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