Google Groups no longer supports new Usenet posts or subscriptions. Historical content remains viewable.
Dismiss
social security tax addback for high income earners
12 views
Skip to first unread message
removep...@yahoo.com
Jan 24, 2012, 2:54:01 PM1/24/12
to
Does anyone know how the social security tax addback for high income
earners works? As you know, for Jan and Feb everyone only withholds
4.2% social security tax. But if you make a lot you have to pay back
the 2%, or maybe even more, later.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>
earners works? As you know, for Jan and Feb everyone only withholds
4.2% social security tax. But if you make a lot you have to pay back
the 2%, or maybe even more, later.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2011) - All rights reserved. >>
<< ------------------------------------------------------- >>
Arthur Kamlet
Jan 24, 2012, 7:04:48 PM1/24/12
to
In article <31be6d98-8d3d-425f...@o20g2000yqh.googlegroups.com>,
Congress, who knows?
The social security FICA limitation assumes that any FICA tax at 4.2
applies only to the first 106,800 annual limit /12 months x 2 months
of FICA income, and any additional FICA income that received the
4.2 rate becomes an income tax surcharge. (I assumed that 106800
is the maximum FICA wages subject to FICA tax.)
--
ArtKamlet at a o l dot c o m Columbus OH K2PZH
removep...@yahoo.com <removep...@yahoo.com> wrote:
>Does anyone know how the social security tax addback for high income
>earners works? As you know, for Jan and Feb everyone only withholds
>4.2% social security tax. But if you make a lot you have to pay back
>the 2%, or maybe even more, later.
Most folks assume it will never actually go through, but with this
>Does anyone know how the social security tax addback for high income
>earners works? As you know, for Jan and Feb everyone only withholds
>4.2% social security tax. But if you make a lot you have to pay back
>the 2%, or maybe even more, later.
Congress, who knows?
The social security FICA limitation assumes that any FICA tax at 4.2
applies only to the first 106,800 annual limit /12 months x 2 months
of FICA income, and any additional FICA income that received the
4.2 rate becomes an income tax surcharge. (I assumed that 106800
is the maximum FICA wages subject to FICA tax.)
--
ArtKamlet at a o l dot c o m Columbus OH K2PZH
Alan
Jan 24, 2012, 7:47:20 PM1/24/12
to
On 1/24/12 12:54 PM, removep...@yahoo.com wrote:
> Does anyone know how the social security tax addback for high income
> earners works? As you know, for Jan and Feb everyone only withholds
> 4.2% social security tax. But if you make a lot you have to pay back
> the 2%, or maybe even more, later.
>
The wage base in 2012 is $110,100. Two months would equal $18,350. In
> Does anyone know how the social security tax addback for high income
> earners works? As you know, for Jan and Feb everyone only withholds
> 4.2% social security tax. But if you make a lot you have to pay back
> the 2%, or maybe even more, later.
>
order to prevent a taxpayer from getting a benefit in excess of 2% of
$18350 for that period, the law created a 2% tax for amounts over
$18,350. The law instructed the Treasury Secretary to issue guidance on
how to carry out that tax. I have not seen the guidance.
--
Alan
http://taxtopics.net
removep...@yahoo.com
Jan 25, 2012, 4:26:02 PM1/25/12
to
On Jan 24, 4:04 pm, kam...@panix.com (Arthur Kamlet) wrote:
> removeps-gro...@yahoo.com <removeps-gro...@yahoo.com> wrote:
> >Does anyone know how the social security tax addback for high income
> >earners works? As you know, for Jan and Feb everyone only withholds
> >4.2% social security tax. But if you make a lot you have to pay back
> >the 2%, or maybe even more, later.
>
> Most folks assume it will never actually go through, but with this
> Congress, who knows?
>
> The social security FICA limitation assumes that any FICA tax at 4.2
> applies only to the first 106,800 annual limit /12 months x 2 months
> of FICA income, and any additional FICA income that received the
> 4.2 rate becomes an income tax surcharge. (I assumed that 106800
> is the maximum FICA wages subject to FICA tax.)
Actually the limit in 2012 is 110,100 http://www.ssa.gov/pressoffice/pr/2012cola-pr.html.
Is the cap on the extra 2%. Say someone makes $40,000 a month.
110,100/12=9175, so they pay just 4.2% on this 9175, which is 385.35.
Then do they pay 2% on the full amount above 9175? If yes, this means
2% of (40000-9175) = 616.5. Total is 1001.85. Whereas 6.2% of 9175
is just 568.85 -- if the payroll tax cut just expired the super-rich
would pay just 568.85 a month, but because of this 2% on all of their
income, they're actually paying more. Does the law mandate no cap on
this surcharge?
Also, assuming the payroll tax cut does not get extended, it would
make sense to not sell any non qualified stock options in Jan and Feb
as these are considered W-2 income.
> removeps-gro...@yahoo.com <removeps-gro...@yahoo.com> wrote:
> >Does anyone know how the social security tax addback for high income
> >earners works? As you know, for Jan and Feb everyone only withholds
> >4.2% social security tax. But if you make a lot you have to pay back
> >the 2%, or maybe even more, later.
>
> Most folks assume it will never actually go through, but with this
> Congress, who knows?
>
> The social security FICA limitation assumes that any FICA tax at 4.2
> applies only to the first 106,800 annual limit /12 months x 2 months
> of FICA income, and any additional FICA income that received the
> 4.2 rate becomes an income tax surcharge. (I assumed that 106800
> is the maximum FICA wages subject to FICA tax.)
Is the cap on the extra 2%. Say someone makes $40,000 a month.
110,100/12=9175, so they pay just 4.2% on this 9175, which is 385.35.
Then do they pay 2% on the full amount above 9175? If yes, this means
2% of (40000-9175) = 616.5. Total is 1001.85. Whereas 6.2% of 9175
is just 568.85 -- if the payroll tax cut just expired the super-rich
would pay just 568.85 a month, but because of this 2% on all of their
income, they're actually paying more. Does the law mandate no cap on
this surcharge?
Also, assuming the payroll tax cut does not get extended, it would
make sense to not sell any non qualified stock options in Jan and Feb
as these are considered W-2 income.
Katie in San Diego
Feb 10, 2012, 2:08:35 PM2/10/12
to
On Jan 25, 1:26 pm, "removeps-gro...@yahoo.com" <removeps-
of the NQSO that generates W-2 income, not the sale of the stock.
Katie in San Diego
gro...@yahoo.com> wrote:
> On Jan 24, 4:04 pm, kam...@panix.com (Arthur Kamlet) wrote:
>
> > removeps-gro...@yahoo.com <removeps-gro...@yahoo.com> wrote:
> > >Does anyone know how the social security tax addback for high income
snip
> On Jan 24, 4:04 pm, kam...@panix.com (Arthur Kamlet) wrote:
>
> > removeps-gro...@yahoo.com <removeps-gro...@yahoo.com> wrote:
> > >Does anyone know how the social security tax addback for high income
>
> Also, assuming the payroll tax cut does not get extended, it would
> make sense to not sell any non qualified stock options in Jan and Feb
> as these are considered W-2 income.
>
> --
Change "sell" in the statement above to "exercise." It's the exercise
> Also, assuming the payroll tax cut does not get extended, it would
> make sense to not sell any non qualified stock options in Jan and Feb
> as these are considered W-2 income.
>
> --
of the NQSO that generates W-2 income, not the sale of the stock.
Katie in San Diego
0 new messages