A Taxing Situation
Some adverse effects of the fiscal cliff have been avoided for now, but we still have a spending dispute coming in the next two months, as well as a debate on raising the debt ceiling.
Those outcomes remain to be seen, but what wasn't up for debate was the extension of the temporary two-percentage-point payroll tax cut. This was designed as a temporary stimulus measure by reducing the contribution to the Social Security fund by most working Americans with the federal government covering the difference from federal coffers. Since we all know the concern about the long-term viability of Social Security in the future as the population ages, continuing the payroll tax cut wasn't seen by either party as a solid long-term measure, and these FICA withholdings will increase to 6.2% from 4.2%....522 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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