2006-12-08 06:31:56 · 5 answers · asked by shonjoi200333 1 in Business & Finance ➔ Taxes ➔ United States
This is the Federal Insurance Contrubutions Act. It's better known as Social Security. Under the Federal Insurance Contributions Act (FICA), 12.4 percent of your earned income up to an annual limit must be paid into Social Security, and an additional 2.9 percent must be paid into Medicare.
For 2006, that limit is $94,200.
2006-12-08 06:40:21 · answer #1 · answered by glw 2 · 2⤊ 0⤋
FICA - Federal Insurance Contributions Act. It's split into two chunks - Social Security Tax and Medicare Tax. These are your contributions into the Federal Social Security program.
Social Security is 6.20% of your gross pay (it's capped to shut off after you reach around $90,000 in earnings if you're lucky enough to make that much)
Medicare is 1.45% of your gross (it is not capped).
Together, the FICA tax rate is 7.65%
You employer is required to match that tax dollar for dollar.
2006-12-08 14:41:21 · answer #2 · answered by Anonymous · 1⤊ 0⤋
FICA is the amount you pay for Social Security. You pay half and your employer pays half. In addition, you are having a Medicare tax taken out on top of that. Imagine how much you would have in your savings account if your employers contribution (6.5%) and your contribution (6.5%) were put into a real savings account.
2006-12-08 15:14:04 · answer #3 · answered by united9198 7 · 0⤊ 0⤋
Federal Insurance Contributions Act. The money is used to fund programs to help retirees, disabled people, etc. More directly the money is used to fund Medicare and Social Security.
2006-12-08 14:38:04 · answer #4 · answered by Count Acumen 5 · 2⤊ 0⤋
Federal Income Tax
2006-12-08 17:55:29 · answer #5 · answered by shaydzofluv 2 · 0⤊ 2⤋