It also shows the number of withholding allowances 10

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Unformatted text preview: 35 140 $125 130 135 140 145 0 1 1 2 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 145 150 155 160 165 150 155 160 165 170 4 4 5 6 7 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 170 175 180 185 190 175 180 185 190 195 7 8 9 10 10 0 0 1 2 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 195 200 210 220 230 200 210 220 230 240 11 12 14 15 17 3 5 6 8 9 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 240 250 260 270 280 250 260 270 280 290 18 20 21 23 24 11 12 14 15 17 3 4 6 7 9 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 290 300 310 320 330 300 310 320 330 340 26 27 29 30 32 18 20 21 23 24 10 12 13 15 16 3 4 6 7 9 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Figure 12 – 4 Internal Revenue Service Tax Tables Section 2 Payroll Deductions 308-337_CH12_868829.indd 317 317 9/15/05 11:44:57 AM AS YOU READ Key Point FICA Taxes Social security tax: 6.2% (.062) of annual gross earnings up to $90,000. Medicare tax: 1.45% (.0145) of total annual gross earnings. The FICA taxes are exact taxes in that, unlike the federal income tax, they do not involve estimation and are not affected by allowances or marital status. Congress sets FICA tax rates and can change them at any time. Most employees are subject to FICA taxes, even those who are exempt from federal income taxes. The FICA tax rates are as follows: Social security tax Medicare tax Total FICA taxes 6.20% 1.45% 7.65% The social security tax is deducted from the employee’s earnings until the maximum taxable earnings amount for the year is reached. This amount increases each year. For 2005, the maximum taxable earnings amount was $90,000. The maximum amount of social security tax that could be withheld from an employee in that year was $5,580.00 ($90,000 .062). There is no maximum taxable earnings amount for the Medicare tax. For...
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This note was uploaded on 01/16/2014 for the course BUSINESS Accounting taught by Professor Dr.stevenhall during the Fall '13 term at Del Mar College.

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