Quote:
Originally Posted by Bubba  You pay Social Security taxes on income up to $97500 in 2007 any income over that does not have social secuity tax witheld. Income taxes still apply. These amounts are current in previous years it was less, last year (2006) the amount was $94200, in 2000 it was $76200. This is for an employee, not combined income, so it wouldn't matter if you are married or not. |
Minor points of correction please....
One pays Social Security on "earned" wages. Income comprises lots of things but someone getting 97,500 in dividends and capital gains will not pay social security tax on it. And remember the employer matches the social security tax up to the maximum earned. Self employed individuals pay both sides of the social security tax (but get a deduction in taxable earnings equal to the "employer" half. And then there is the Medicare portion. There is no maximum for the Medicare tax and it is also matched by the employer. Same rule applies as to what is applicable