Unformatted text preview: Capital Gains Long-term capital gains, profit earned on property or stock held for over 12 months, is taxed at different rates than regular income. Overall Tax Rate What percent of the Smith’s income is paid in federal taxes? They paid $2425 in income tax and $4490.55 in FICA tax. Their total income was $60,850. So their overall tax rate is ( 2425 + 4490.55)/ 60,850 • 100 = 11. 36%. *FICA is actually broken into two parts. The social security tax is 6.2% and the Medicare tax is 1.45% (6.2% + 1.45% = 7.65%). Social security tax is paid on income up to $106,800. There is no cap on the Medicare portion of the FICA tax....
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- Summer '08
- Federal Insurance Contributions Act tax