Now that the 2% SS deduction is kicking in

[Value Buy]

Does anyone have an idea what to do with your raise?
Instead of just spending it, that is.

[The Virginian]

We use Quickbooks Enhanced Payroll systems. I just checked to see if the tax amounts have changed. They have not. We just got the latest update last week.

Is this deduction in the extended tax reductions? How long is it suppose to last?

[robvinchgo]

Hello,

Unfortunately our state government is in the process of increasing our taxes so the additional money from the federal government will be taken by our state to help pay for all of their mismanagement and corruption over the years.

[Deleted]

Our payroll system has updated the tax rates properly. For someone making $50k a year, the "savings" is roughly $76/month. This is set to last for 2 years.

But I don't beleive the making work pay tax credit was extended, which was worth, what $400 for the year?

[jarhead1976]

I can not see it making to much of a difference. Will not the 2% reduction, increase net income before taxes due at end of year?

[dancinmama]

Jan 9, 2011 0:49:21 GMT -5 Value Buy said:

Does anyone have an idea what to do with your raise?
Instead of just spending it, that is.

We're going to put it in our "retirement EF". DH is planning on taking early retirement in 2012.

[Deleted]

Jan 10, 2011 14:41:51 GMT -5 @jarhead1976 said:

I can not see it making to much of a difference. Will not the 2% reduction just increases your net income before taxes due at end of year?

No it won't.

[verrip1]

I think 'just spending it' is what was envisioned.

[neohguy]

I got my 1st paycheck of the year today. Our payroll company made the adjustment. This is a great idea, reducing contributions to an insolvent fund.

[frep]

Mine nets out to $13 a pay period.

My SS taxes went down $39 but my federal taxes increased $21 and my state taxes increased $5. I'll probably just put $20 more a month into my ROTH.

[decoy409]

This is a fun one!

Quote: jarhead, can not see it making to much of a difference. Will not the 2% reduction just increases your net income before taxes due at end of year?

Arch,No it won't.

&

verrip1, I think 'just spending it' is what was envisioned.

or how about 'IT'S A TAPPED COOKIE JAR!' So like it really matters? 2%, this needs a adjustment say a roll over to State and Federal and lets make the overall cut between the 3, 75% !!! It's all been TAPPED, TAPPED, TAPPED year in and year out so giving back would be the proper. I bet you would SEE some consumer spending action then!

[z]

Maybe I'm being too cynical but the 2% 'refund' from the SS deduction on our paychecks was the first step towards dumping SS for the generation after the baby boomers (us) or at least cutting the benefit to the bone for our children after they pay for our SS retirement checks. A few more $ in our pocket right now and to hell with our children's future later is what it seems to me our govt intends to do!

[neohguy]

Jan 11, 2011 16:39:26 GMT -5 @z said:

Maybe I'm being too cynical but the 2% 'refund' from the SS deduction on our paychecks was the first step towards dumping SS for the generation after the baby boomers (us) or at least cutting the benefit to the bone for our children after they pay for our SS retirement checks. A few more $ in our pocket right now and to hell with our children's future later is what it seems to me our govt intends to do!

I agree Z. The 2% reduction along with the extension of tax cuts to the upper tier was totally irresponsible. Even more irresponsible that their is no public outrage.

[The Virginian]

Even more irresponsible that their is no public outrage.

First you would have to pry those cell phones from their faces and then maybe you would see some outrage!

[jarhead1976]

The fans blowing!

[bean29]

I don't see them ever putting the SS tax rate back up to 7.65%. If that were do-able the Bush Tax Cuts would not have been extended.

I agree it was irresponsible but, people who are desperately broke are not going to complain about $700 more taxable income. I am not going to complain because I figure it is better off in my 401K account than in a SS account that may eventually be means tested.

I do think this is the beginning of a tiered phase out of SS. Baby boomer's get SS. Gen X gets reduced SS Gen Y has to make other plans kind of thing.

[verrip1]

Jan 11, 2011 16:22:19 GMT -5 decoy409 said:

This is a fun one!

Quote: jarhead, can not see it making to much of a difference. Will not the 2% reduction just increases your net income before taxes due at end of year?

Arch,No it won't.

&

verrip1, I think 'just spending it' is what was envisioned.

or how about 'IT'S A TAPPED COOKIE JAR!' So like it really matters? 2%, this needs a adjustment say a roll over to State and Federal and lets make the overall cut between the 3, 75% !!! It's all been TAPPED, TAPPED, TAPPED year in and year out so giving back would be the proper. I bet you would SEE some consumer spending action then!

Can you translate that rant into the English language? I'm sure that you, Virgil, and he-who-is-banned-for-three-days understand it, but I sure don't.

[decoy409]

Sure! The COOKIE JARS are EMPTY and have been due to pilferring left and right year in and year out. You say 'I think 'just spending it' is what was envisioned.' and you are 100% CORRECT! Because to many, this is all they SEE as they are conditioned to SEE exactly as you stated.
So if you want to treat the workers with some real bonus you could! Take 25% off the top on the withholdings such as SS,State,Federal.
All that is and has been going on is the revolving door deal or musical chairs. So let the ants keep that type of cake and see what happens with Consumer Spending. My bet is that the country is still so laxed that it will spend and not save the majority of what they bring home. I will take 3-1 odds.

[traelin0]

Jan 9, 2011 0:49:21 GMT -5 Value Buy said:

Does anyone have an idea what to do with your raise?
Instead of just spending it, that is.

Sure! It almost covers the fees for my gold purchases at GoldMoney, and in the aggregate it'll cover my palladium fees.

[jarhead1976]

Virrip 1 modified my post maybe it makes more sense! Archie If my income goes up because I make more money, (2% SS deduction or not,) I have to pay taxes on that income, Why am I wrong?

[Deleted]

Jan 12, 2011 19:59:21 GMT -5 @jarhead1976 said:

Virrip 1 modified my post maybe it makes more sense! Archie If my income goes up because I make more money, (2% SS deduction or not,) I have to pay taxes on that income, Why am I wrong?

Because your income (gross) is not increasing.

[frankq]

What raise? I live in Illinois. At least for the next 3 years..........

[jarhead1976]

Wrong Archiethedragon , talked with 2 accountants today , both got paid today, the 2% decrease in social security is added to your income and is taxed accordingly... talk to your accountant or IRS agent.

[Deleted]

Jarhead

If you get say 1000.00 a week, minus the 7.62% fica you would get 923.80 before state and federal taxes

Now you still get the 1000.00 a week income, but only pay 5.62% fica you get 943.80

The state and federal taxes are STILL based on the same 1000.00

You DO NOT pay extra state or federal taxes...because the GROSS wages remain the same

And not sure of the accountants you spoke to, but they couldnt work for me....

[Deleted]

Jan 13, 2011 16:32:13 GMT -5 @jarhead1976 said:

Wrong Archiethedragon , talked with 2 accountants today , both got paid today, the 2% decrease in social security is added to your income and is taxed accordingly... talk to your accountant or IRS agent.

I am my accountant, but I'll check with him again.

[verrip1]

The Cookie Jar concept doesn't hold ... cookies, I guess

In the real world, people end up with 2% more in their pocket each paycheck. It doesn't matter whether the dollar is down or the stock market is down or that gold is up or that it's in fiat currency or that the deficit is up.

The 2% in the pocket is R-E-A-L. It's money for commerce. Consider it the beer test. If you can go to the store and buy beer and get back your change with it, it's real. Try that with a gold coin and see if you can get change.

[verrip1]

Jan 13, 2011 16:52:07 GMT -5 ArchietheDragon said:

Jan 13, 2011 16:32:13 GMT -5 @jarhead1976 said:

Wrong Archiethedragon , talked with 2 accountants today , both got paid today, the 2% decrease in social security is added to your income and is taxed accordingly... talk to your accountant or IRS agent.

I am my accountant, but I'll check with him again.

And you have such a reputation with payroll.

[Deleted]

Jan 13, 2011 16:58:54 GMT -5 verrip1 said:

Jan 13, 2011 16:52:07 GMT -5 ArchietheDragon said:

I am my accountant, but I'll check with him again.

And you have such a reputation with payroll.

I can't process it, but I understand it.

[jarhead1976]

Pittance to the peasants , I feel so lucky. Your Right I was wrong.

[sangria]

I got mine and I'm headed to the naked lady bar!