Millions of Big Earners Should Expect Higher Payroll Taxes in ‘17
For those who have been excited to see their tax bill go down under a Trump administration, there might be cause for some concern, especially for some of the country’s highest earners. That’s because for the millions of workers who pass a certain threshold a tax hike is coming. So why the increase?
First, this change was in place before President Trump won the election in November. This scheduled change comes in the form of an adjustment to Social Security payroll taxes, and it will affect a lot of high earners. Over the past several years, workers have paid a 6.2 percent payroll tax to Social Security, which is matched by employers and automatically deducted from their paychecks.
That number will remain the same in 2017, but there is a catch. It used to be that workers only paid that amount on the first $118,500 they earned for the year. This year, that threshold increases to $127,200. That will amount to hundreds of dollars for anyone affected. Meantime, for self-employment workers, the news is even worse because they are forced to pay the full Social Security tax themselves without splitting the cost with an employer.
So how many people are we talking about? Anyone that makes less than $118,500 won’t be affected but the estimated 12 million workers that make more than that will see a hit, which amounts to one of the biggest changes in the tax code in nearly 30 years.
http://time.com/money/4628475/payroll-taxes-social-security-2017/
Bookkeeping: What Kind of Records Should I Keep?
Bookkeeping: What Kind of Records Should I Keep? You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep…
Tips to Help Taxpayers with January 31 Tax Season Opening
We are again suggesting some tips to help taxpayers with the January 31 tax season opening. The IRS will begin processing most individual income tax returns on Jan. 31 after updating forms and completing programming and testing of its processing systems. The IRS anticipated many of the tax law changes made by Congress under the…
Looks Like More Wealthy Americans Are Saying Goodbye to the U.S.
The country just got done celebrating its independence this past weekend. With fireworks and all kinds of parties, Americans celebrated to show their appreciation for one of the greatest gifts they have: Freedom. Most Americans are very proud of their citizenship, even if they don’t always like everything the about the laws of the land.…
Why Are More Americans Kissing Their Country Goodbye?
Why Are More Americans Kissing Their Country Goodbye? As the controversy over tax inversions continues to rage on, there is another telling sign that more and more Americans are finding the country’ tax code too frustrating to handle. It’s not just U.S. companies that are giving up their U.S. citizenships, so-to-speak. An increasing number of…