The Social Security tax withheld from employees during 2011 will be 6.2% of the first $106,800 of each employee’s taxable earnings. The employee’s earnings in excess of $106,800 are not subject to the Social Security tax. In addition to the Social Security tax, the entire amount of each employee’s taxable earnings is subject to the Medicare tax of 1.45%. These rates and the Social Security wage base limit are unchanged from the years 2010 and 2009.
Both the Social Security tax and the Medicare taxes must be matched by the employer. This means that the employer must remit to the federal government 12.4% of each employee’s first $106,800 of taxable earnings plus 2.9% of each employee’s earnings regardless of the amount.
Self-employed individuals are responsible for paying both the employee and the employer portions of the Social Security tax and the Medicare tax.
Learn more about Payroll Accounting.
About the Author: Harold Averkamp (CPA) has worked as an accountant, consultant, and university accounting instructor for more than 25 years.
He is the author of the 2010 Master Accounting Download Package which has been praised for it's ability to simplify accounting in a way that anybody can understand.
Niciun comentariu:
Trimiteți un comentariu