There has been a reduced Social Security payroll tax rate for the past 2 years. It was reduced from 6.2% to 4.2%. At this time it is scheduled to revert back to 6.2% January 1, 2013, unless Congress decides not to let the payroll tax holiday expire at the end of 2012.

It may not seem like a big deal, but if you are living close to paycheck to paycheck any dollar can make a difference.

With the tax rate increase, someone making $50,000 a year would pay an extra $1,000 in taxes in 2013, reducing the monthly take-home pay by $83.33. If you have stretched yourself thin with holiday bills, this reduction of your pay will be even more painful.

Here is a link to a calculator to figure how it will affect your paycheck.

There was an article on Kiplinger.com with more information on the tax increase.

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