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12 Million to Pay More Social Security Tax in 2017
Source:
investopedia.com
- Jan 11, 2017
Amid all the chatter about tax cuts the incoming Republican administration is expected to shepherd through a Republican Congress, it's easy to lose sight of a tax increase. Social Security payroll tax is set to rise for some workers due to a 7.3% increase in the maximum taxable earnings cutoff from $118,500 to $127,200.
Social Security payroll tax differs from federal income tax, which is levied on practically all income (that isn't stashed away in tax havens) and applies higher rates to higher earners. Old age, survivor and disability insurance (OASDI) – as the Social Security portion of payroll taxes is known – is only paid on the first $127,200 in earnings, and the tax rate on income below that threshold is a steady 6.2% for all income levels (12.4% for the self-employed, who must pay the employee and employer contributions). For the approximately 161 million workers making less than that cap every year, this year's change doesn't apply.
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Category: General Business
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