Your employer is forced to pay 7.5% of your wages to Social Security (FICA). This is in addition to the 7.5% FICA deduction you see on your check stub.
As of the new law passed in Dec 2010:
The tax is payable on the first $106,800 of earnings. Earning are defined slightly differently for this than what is used for withholding, (or other things). Additionally, a portion of what was a total of 15.3% tax equally paid between employer & employee - or entirely by self employed (half employer paid, half employee), is dedicated to Medicare and has no maximum earnings limit.
Under current law, employees pay a 6.2% Social Security tax on all wages earned up to $106,800 (in 2011) and self-employed individuals pay 12.4% Social Security self-employment taxes on all their self-employment income up to the same threshold.
For 2011, the Senate passed 2010 Tax Reform Act gives a two-percentage-point payroll/self-employment tax holiday for employees and self-employeds. As a result, employees will pay only 4.2% Social Security tax on wages and self-employment individuals will pay only 10.4% Social Security self-employment taxes on self-employment income up to the threshold.
The maximum savings for 2011 will be $2,136 (2% of $106,800).
The amount paid by the employer will not change and will be that same 2% more than the employee.
An employer is required by law to subtract FICA from your paycheck (or pay it himself and add the amount as additional income on your W-2) as well as pay his own share. Your employer will deduct the amount from your salary with or without your consent. In rare cases where the employer cannot deduct FICA from your salary (for example, you work mostly on tips and your salary is less than what you owe for FICA), your employer will simply report the uncollected amount to the IRS on your W-2 and whether you pay or not is between you and the IRS. Similarly, if you have unreported tips or self-employment, your employer will not get involved in whether or not you pay.
Yes they do. All wages are subject to FICA and Medicare Taxes. The employer and employee each pay 6.2% of the gross income for Social Security Tax and each pays 1.45% of the gross income for Medicare Taxes. The number of hours works has nothing to do with whether or not taxes are taken out for these taxes.
Yes. The way it works in most cases is that you pay FICA taxes in the amount of 6.2% of your gross income and your employer also pays the same amount. Also you are required to pay 1.45% of your gross income for Medicare tax and your employer also matches that amount. So in total you are paying for half of these two taxes and your employer pays for half of the total taxes for these two taxes.
You could have some other amounts beside FICA that your employer will be required to withhold from your gross wages for the pay period before your net take home paycheck is issued to you. You should get this information from your employer payroll department as they will be the one that would know how much FICA, federal income tax, state income, local taxes, etc they will have to withhold from your hourly pay or gross pay for the pay period.
FICA percent is 15.3% regardless of the number of dependents If you are self employed you pay the full 15.3% which is 12.4% social security and 2.9% medicare If you are employed by someone else you pay half of the FICA or 7.65% of which 6.2% is social security and 1.45% is medicare. You employer than pays the other half.
FICA stands for Federal Insurance Contributions Act. Basically, it's taxes used as payment into the Social Security and Medicare benefits programs. This is how you contribute to those programs. When you're an employee, you pay half and your employer pays half. Your half is deducted from your paycheck, then your employer adds their half and sends the entire amount in on your behalf when they pay all the other payroll taxes. Self-employed people don't have an employer to pay half, so they pay the entire amount for their Social Security and Medicare taxes.
FICA contributions, including various sub (categories of things like SS, Disability, Health, etc) are 15.30% of FICA wages. What is considered FICA wages differ from other wage considerations in many ways, (it has a top limit of about 97.5K, how pension contributions factored, State taxes, etc.). If you are an employee, the employer MUST pay half of the contribution. If your self - employed, the amount normally paid by the employer is collected through something called the "self employment tax" when you file your income tax return.
FICA contributions, including various sub (categories of things like SS, Disability, Health, etc) are 15.30% of FICA wages. What is considered FICA wages differ from other wage considerations in many ways, (it has a top limit of about 106,800, how pension contributions factored, State taxes, etc.). If you are an employee, the employer MUST pay half of the contribution so you pay 7.65% and the employer pays the same. If you're self-employed, the amount normally paid by the employer is collected through something called the "self employment tax" when you file your income tax return.
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