Paycheck A Little Smaller? Here's Why...
You may have been spared from paying more in income taxes, but there still could have been a hit to your paycheck after the Fiscal Cliff Tax Deal was reached earlier this month. Here's all you need to know...
If you take a close look at your first 2013 paystub you will probably notice that Uncle Sam took a bigger chunk of your pay for Social Security.
Taxpayers got a temporary holiday from paying the full 6.2 percent beginning in 2011, but that is over thanks to the fiscal cliff tax deal reached earlier this month.
That legislation stopped the income tax hikes for most Americans, but the Social Security payroll tax holiday was allowed to expire. AOL explains it like this:
Social security is financed by a 12.4 percent tax on wages, with employers paying half and workers paying the other half. During the temporary holiday, the employee contribution was reduced to 4.2 percent in 2011 and 2012, saving a typical family about $1,000 a year.
To see this in a different way, check out this bar graph showing how much more in taxes people will have to pay by income.
Closer to home, we asked on Facebook how much lighter your paycheck was and how you felt about it. Here’s what people had to say:
Leah Larson Federal less than $7 but FICA $82!
odie Kuzba Such garbage !! Hope I see my ssi come back to me.
Chad Brown Glad to see I'm in Obama's "Rich" category.
MeghanandRyan Lowery-Brace Someone please tell me what defines "rich" for Obama? I'm a stay at home mom who works one day a week and my already little paycheck took a hit!
Amy Disch I got a very nice raise for 2013, but was very disappointed when my first check of the year was less than my last of 2012. The middle class just keeps getting hit and the rich get richer. It stinks!