Now the bad news about fiscal check. Your paycheck will be hit

January 3, 2013

The Payroll Tax Cut, which reduced your share of payroll taxes by 2 percent and increased your net pay, expired on Dec. 31, 2012 and was not renewed by Congress.

I’m told that there are bills currently being considered in Congress that may change this but until the lawmakers act to further extend the cut, your employer will withhold FICA based on 6.2% with paychecks beginning in January 2013.

The 2013 FICA tax rate, which is the combined Social Security tax rate of 6.2% and the Medicare tax rate of 1.45%, will be 7.65% for 2013 up to the social security wage base.

If you make $10/hour, your net pay will be $8 less on a 40-hour work week.

As far as Federal Income Tax Withholding, the IRS hasn’t issued the 2013 federal withholding tax tables. The IRS has instructed employers to not change anything with regard to withholding; to use the same withholding tables that have been used for 2012.

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  • Ross Calloway January 5, 2013 at 5:43 pm

    Truth is, if you knew why you got a payroll tax break in the first place, then you should be ashamed of yourself for not wanting to pay more taxes now. Matter of fact, we owe senior citizens somewhere over 100 Billion dollars. That’s roughly what the 14 month-long raid on Social Security’s took from Social Security’s only source of funding, the payroll tax. Long story short, you’ve been had. Senior citizens have been had. The low-information voters have been had. Both political parties played politics on the backs of senior citizens. But Obama is the one who profited from it. He got re-elected on the promise that the 99 percenters would not see their taxes go up. Fools.

  • Ames January 3, 2013 at 2:07 pm

    The payroll tax cut was part of the stimulus package two years ago, and was not ever meant to be permanent but rather a temporary measure, combined with other measures, to ease the strain on wallets caused by the 2007 recession.