i was told as an employee you pay half of your social security and your employer pays the other half. Is this true?
2007-06-21 11:39:45 · 8 answers · asked by mugithi 1 1 in Business & Finance ➔ Taxes ➔ United States
No you do. Its all a bunch of wacky bookeeping. Your employer highers you and knows what it will cost to employ you. The employer contribution is your money taken by the federal government. If you were to put the 14 percent taken out for ss put it in the bank at 5 percent you'd end up with a heck of a lot more than you do now. But the thieves in Washington wouldn't have as much money for vote buying schemes. They also love to use ss as a scare tactic to get votes.
2007-06-21 12:14:05 · answer #1 · answered by Anonymous · 2⤊ 3⤋
Yes and no. According to the IRS, you and your employer each pay 7.65% of you wages for social security and medicare. However, your employer knew that when they decided how much to pay you. The 'payroll tax' was figured into the offer. Your income IS reduced by the full amount even if you never see the money on your pay statement.
2007-06-21 13:39:14 · answer #2 · answered by STEVEN F 7 · 0⤊ 0⤋
Yes, it is true. However the half that you pay, you also pay income taxes on when you contribute it. The half that your employer pays is tax-free to you.
When you take payments from Social Security, up to 85% of that could be taxed, so in effect some of the employer's contribution may eventually be taxed.
2007-06-21 15:02:03 · answer #3 · answered by ninasgramma 7 · 0⤊ 0⤋
Social Security taxes are taken out of your paycheck every pay period. Your employer also contributes to Social Security. The Social Security administration sends you a yearly statement detailing the amount of money you have earned every year, how much money you can collect if you retire at age 65 and age 72. They also tell you what your survivors can collect in the event of your untimely demise.
2007-06-21 12:17:41 · answer #4 · answered by Anonymous · 0⤊ 0⤋
The employer REMITS half of your social security tax. Keep in mind that employers are incapable of actually PAYING for any taxes. They merely collect them from other people. This could be you (in the form of wages that are less than you might otherwise receive), customers who buy your products and services, or owners of the business that employs you.
2007-06-21 12:21:25 · answer #5 · answered by SDD 7 · 0⤊ 3⤋
Yes that's true - you each pay 7.65% of your salary. If you are self-employed, you pay both halves, or 15.3% of your net income.
2007-06-21 11:43:27 · answer #6 · answered by Judy 7 · 1⤊ 0⤋
Yes - its currently 6.2% and an additional 1.45% for medicare so its a total of 7.65%.
2007-06-21 11:45:45 · answer #7 · answered by professorc 7 · 0⤊ 0⤋
Yep, that's exactly how it works!
If you are Self-Employed, you have to pay both halves.
2007-06-21 11:47:24 · answer #8 · answered by Bostonian In MO 7 · 0⤊ 0⤋