djAdvocate
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Post by djAdvocate on Oct 22, 2013 13:15:16 GMT -5
I wasn't self employed for most of my career either, but I still paid 12.5%. your employer didn't pay half?I've been a hiring manager. Salary decisions are based on total cost to the employer. that is a different standard, imo.My boss paid me less because he was paying 6.25% to my FICA, he was paying unemployment insurance on me, etc., etc. Employers don't pay those things. The check might come from their account, but it's reflected in the amount they put in yours. Self employed or not, you're giving up 12.5% of your income just to FICA. that is not how i view things. i could easily pay my employees 6.25% less than i do. i could easily pay them 6.25% more. what i actually pay them has more to do with their value than their cost. and i would pay that whether SS was 12.5% or 0. now, i really have no idea how bigger companies that have positions like "hiring manager" work, so i will have to take your word for it. but i can tell you that both on the books, and in my way of thinking, i view the 6.25% as "overhead", not "COGS".
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djAdvocate
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Post by djAdvocate on Oct 22, 2013 13:16:55 GMT -5
I could go for it, but like I said, it better come with drastic cuts to the tax rate. I'm one of those that figures I'm going to get screwed out of SS one way or the other, and I'm alright with that, but not if I lose most of my benefit and have to continue giving up over 10% of my salary to it. What idiot would go for that deal? I'd rather see the whole thing collapse. If I'm getting screwed either way, I'd rather take you old bastards with me. you are getting screwed one way or the other, and it is probably best that we leave it at that.
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Angel!
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Post by Angel! on Oct 22, 2013 13:20:51 GMT -5
I wasn't self employed for most of my career either, but I still paid 12.5%. I've been a hiring manager. Salary decisions are based on total cost to the employer. My boss paid me less because he was paying 6.25% to my FICA, he was paying unemployment insurance on me, etc., etc. Employers don't pay those things. The check might come from their account, but it's reflected in the amount they put in yours. Self employed or not, you're giving up 12.5% of your income just to FICA. In a way. But if the employers suddenly didn't owe SS, most would not give all their employees a 6.25% raise as a result.
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Post by Deleted on Oct 22, 2013 13:26:02 GMT -5
it was i have a real issue penalizing savers/investors please clarify what you mean by this: are you suggesting that those with lots of investments will have a "wealth penalty"? if so, WHY? did you get this from some place, or did you simply IMAGINE it happening? i have read a few items where assets will be the means test.....not income if they use that, then that PENALIZES savers/investors that will totally be asinine in my opinion lets penalize mom & pop who saved for 45 years.....and actually have built a nest egg what idiot in washington is dumb enough to EVEN CONSIDER this...... now if they make the asset level high enough......say 10 million + i can probably live with it but anything under that and you start to undermine the reasons to invest or save
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workpublic
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Post by workpublic on Oct 22, 2013 13:55:14 GMT -5
what idiot in washington is dumb enough to EVEN CONSIDER this.. one that will exempt himself.
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Sum Dum Gai
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Post by Sum Dum Gai on Oct 22, 2013 14:13:43 GMT -5
Call it whatever makes you happy, but when an employee asks for a raise you have to take your overhead into account when deciding whether or not to grant it, correct? Every dollar you pay the feds on behalf of Johnny Worker is a dollar you don't have when Johnny asks for a raise.
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Post by Deleted on Oct 22, 2013 15:01:09 GMT -5
A lot of SSI payments have gone to widows who outlived their spouses by decades.
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djAdvocate
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Post by djAdvocate on Oct 22, 2013 16:35:35 GMT -5
please clarify what you mean by this: are you suggesting that those with lots of investments will have a "wealth penalty"? if so, WHY? did you get this from some place, or did you simply IMAGINE it happening? i have read a few items where assets will be the means test.....not income a "means test" IS an income test. that is the entire basis for progressive taxation.if they use that, then that PENALIZES savers/investors ok, just show me where you read anything like this and we will go from there.that will totally be asinine in my opinion i don't think it is something that is being seriously discussed. this reminds me of the "taxing the 401k" account discussion. it was something that was mentioned in a committee, never brought up for a vote because it was so asinine, and never made it to the floor in the form of legislation- but it was all over the blogs for almost a year.lets penalize mom & pop who saved for 45 years.....and actually have built a nest egg what idiot in washington is dumb enough to EVEN CONSIDER this...... now if they make the asset level high enough......say 10 million + i can probably live with it but anything under that and you start to undermine the reasons to invest or save i honestly think you are worrying about something that has never been seriously considered, but if i am wrong, just show me. edit: i just looked up Means Test at wiki. the definition uses "income" 11x, and wealth zero times: en.wikipedia.org/wiki/Means_test
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djAdvocate
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Post by djAdvocate on Oct 22, 2013 16:39:06 GMT -5
Call it whatever makes you happy, this is not a semantics thing for me. it is an accounting thing for me. this is a GL thing for me.but when an employee asks for a raise you have to take your overhead into account when deciding whether or not to grant it, correct? Every dollar you pay the feds on behalf of Johnny Worker is a dollar you don't have when Johnny asks for a raise. if an employee asks me for a raise, i appraise his value to the company, and whether there is any profit in what he is doing. that is all i consider, honestly. when my gross margin gets too low, i raise prices.
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mmhmm
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Post by mmhmm on Oct 22, 2013 16:43:09 GMT -5
*chuckle* I think some may have their panties in a wad because I said I wouldn't mind seeing a means test on SS, dj. As far as I know, it isn't being considered. The fact I wouldn't mind it doesn't mean it's about to become a reality!
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Sum Dum Gai
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Post by Sum Dum Gai on Oct 22, 2013 16:48:00 GMT -5
Which would be determined based on your overhead costs, including the FICA taxes you pay on his behalf, right? Whether you allocate that overhead directly per employee or just use the company wide total, that money coming out of your pocket is factored into your decisions on adding staff, increasing pay, or expanding benefits. I don't think it's a stretch to say that employees are already paying both halves of FICA taxes, but I can understand you not wanting to go that far. Can you at least admit that you having to pay half the FICA taxes does directly impact your employees because it impacts hiring decisions, salary levels, and whatnot?
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djAdvocate
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Post by djAdvocate on Oct 22, 2013 16:48:26 GMT -5
*chuckle* I think some may have their panties in a wad because I said I wouldn't mind seeing a means test on SS, dj. As far as I know, it isn't being considered. The fact I wouldn't mind it doesn't mean it's about to become a reality! yeah, i think you are seeing what is likely to happen if the idea got to the public debate level.
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Angel!
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Post by Angel! on Oct 22, 2013 17:01:53 GMT -5
*chuckle* I think some may have their panties in a wad because I said I wouldn't mind seeing a means test on SS, dj. As far as I know, it isn't being considered. The fact I wouldn't mind it doesn't mean it's about to become a reality! What I find fascinating is that someone who absolutely insists on dumping the ACA because of it's long-term impact to the debt isn't just as interested in fixing SS for the same reason. Could it be the all-out hatred of the ACA wasn't really about the resulting deficit after all? Seems we have found a bit of inconsistency in someone's beliefs.
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djAdvocate
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Post by djAdvocate on Oct 22, 2013 17:09:16 GMT -5
Which would be determined based on your overhead costs, including the FICA taxes you pay on his behalf, right? precisely. but it is mostly dictated by revenue. if i don't have enough revenue, it won't matter what my overhead is- i won't be covering it. if i have enough, it will cover all the expenses, and leave me with a nice profit to boot.Whether you allocate that overhead directly per employee or just use the company wide total, that money coming out of your pocket is factored into your decisions on adding staff, increasing pay, or expanding benefits. really, my entire organization is revenue dictated. but i am probably not a good example, because i am in a niche market. our gross margin is running 46% so far this year.I don't think it's a stretch to say that employees are already paying both halves of FICA taxes, but I can understand you not wanting to go that far. Can you at least admit that you having to pay half the FICA taxes does directly impact your employees because it impacts hiring decisions, salary levels, and whatnot? no, it really doesn't. but it impacts OTHER decisions- like, whether i repaint my building, add a new heater vent, or do some landscaping. we are only talking about 1.56% on sales, and that is such a small impact that a 3% increase i sales would cover it for me.
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billisonboard
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Post by billisonboard on Oct 22, 2013 17:24:46 GMT -5
... The fact I wouldn't mind it doesn't mean it's about to become a reality! Say it ain't so!
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mmhmm
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Post by mmhmm on Oct 22, 2013 17:29:07 GMT -5
... The fact I wouldn't mind it doesn't mean it's about to become a reality! Say it ain't so! Oh, but it is! Don't doubt me EVER! (Especially when I say my opinion doesn't count for beans in things like this)
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billisonboard
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Post by billisonboard on Oct 22, 2013 17:31:19 GMT -5
Oh, but it is! Don't doubt me EVER! (Especially when I say my opinion doesn't count for beans in things like this) And I thought Five Star Administrators ruled the world. See people do learn things here on this message board.
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Sum Dum Gai
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Post by Sum Dum Gai on Oct 22, 2013 17:32:27 GMT -5
Eh, it's probably just a viewpoint thing. I got yelled at on YM for saying government employees don't pay taxes as well.
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mmhmm
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Post by mmhmm on Oct 22, 2013 17:37:51 GMT -5
Oh, but it is! Don't doubt me EVER! (Especially when I say my opinion doesn't count for beans in things like this) And I thought Five Star Administrators ruled the world. See people do learn things here on this message board. That's what I thought! Unfortunately, it ain't so! Cats rule the world!
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djAdvocate
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Post by djAdvocate on Oct 22, 2013 17:44:05 GMT -5
Eh, it's probably just a viewpoint thing. I got yelled at on YM for saying government employees don't pay taxes as well. LOL! well, the other thing is that i don't have to do a lot of hiring here. the two companies i run have run went from 25 employees to 13 in 3 years. i just hired 3, but those are the first hires i have done since Bush was in office.
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tallguy
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Post by tallguy on Oct 22, 2013 19:55:13 GMT -5
No. Social Security is based off of your 35 highest years of earnings. The estimates you received utilized the assumption that you would continue to earn your most recent wage or salary until full retirement age. With your income dropping from previous years, the assumption changed. Not only do you now have lower earnings years figuring into the calculation but the projection of your earnings until FRA now uses the more recent (lower) number. That is why your estimate has dropped.
The rest of your post is a non sequitur. It does not address the original question which was means-testing based on assets instead of income.
Are you sure it is 35 years? I had always heard it was something like your 12, maybe 14 highest earning years.
From the link:
It isn't necessarily the highest 35 years in absolute dollar terms. They have an indexing factor for making prior years' earnings comparable to current and recent years. You should check out the link. It does a good job of explaining it.
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Post by EVT1 on Oct 23, 2013 0:05:11 GMT -5
So what is wrong with a means test anyway?
I am biased because I worked for SSA for a bit back in the day- but what I support 100% is the insurance component- which is relevant to a means test if you view the entire system as an insurance policy.
Of course we have people that bitch- 'well if I had my FICA in a Roth I would end up with so much money, blah blah blah...
They ascribe absolutely no value to the disability insurance they have had and ignore it. Our posters ignore it. Guess what- if you have paid FICA- you are getting a benefit whether you know it or not. My guess is the complainers have no fucking clue and I wish we could opt their asses out. 'Well I wrecked my motorcycle and rebel flag'- be glad you are not part of the vegetable garden!
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Angel!
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Post by Angel! on Oct 23, 2013 4:35:47 GMT -5
Don't forget about survivor benefits. We all basically have an insurance policy to help our children if we die.
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Post by Deleted on Oct 23, 2013 5:19:00 GMT -5
I wasn't self employed for most of my career either, but I still paid 12.5%. your employer didn't pay half?I've been a hiring manager. Salary decisions are based on total cost to the employer. that is a different standard, imo.My boss paid me less because he was paying 6.25% to my FICA, he was paying unemployment insurance on me, etc., etc. Employers don't pay those things. The check might come from their account, but it's reflected in the amount they put in yours. Self employed or not, you're giving up 12.5% of your income just to FICA. that is not how i view things. i could easily pay my employees 6.25% less than i do. i could easily pay them 6.25% more. what i actually pay them has more to do with their value than their cost. and i would pay that whether SS was 12.5% or 0. now, i really have no idea how bigger companies that have positions like "hiring manager" work, so i will have to take your word for it. but i can tell you that both on the books, and in my way of thinking, i view the 6.25% as "overhead", not "COGS". It may not be how you view it, but it's how most employers do. Taxes are part of an employee's total compensation package. This is part of the ECI discussion we've had. Higher employer-paid taxes means lower salary or other compensation.
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Post by Deleted on Oct 23, 2013 5:21:15 GMT -5
I wasn't self employed for most of my career either, but I still paid 12.5%. I've been a hiring manager. Salary decisions are based on total cost to the employer. My boss paid me less because he was paying 6.25% to my FICA, he was paying unemployment insurance on me, etc., etc. Employers don't pay those things. The check might come from their account, but it's reflected in the amount they put in yours. Self employed or not, you're giving up 12.5% of your income just to FICA. In a way. But if the employers suddenly didn't owe SS, most would not give all their employees a 6.25% raise as a result. Not immediately, but there is a 100% chance that 6.25% would gradually work its way into salary or other benefits. Competition would ensure it.
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AgeOfEnlightenmentSCP
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Post by AgeOfEnlightenmentSCP on Oct 23, 2013 9:47:01 GMT -5
that is not how i view things. i could easily pay my employees 6.25% less than i do. i could easily pay them 6.25% more. what i actually pay them has more to do with their value than their cost. and i would pay that whether SS was 12.5% or 0. now, i really have no idea how bigger companies that have positions like "hiring manager" work, so i will have to take your word for it. but i can tell you that both on the books, and in my way of thinking, i view the 6.25% as "overhead", not "COGS". It may not be how you view it, but it's how most employers do. Taxes are part of an employee's total compensation package. This is part of the ECI discussion we've had. Higher employer-paid taxes means lower salary or other compensation. Or put another way- the total cost of an employee is a single line item made up of salary, benefits, cost of compliance- taxes and other considerations which has to add up to something that makes sense in terms of a business hiring, or keeping an employee. It's really not that complicated, nor difficult to understand.
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Sum Dum Gai
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Post by Sum Dum Gai on Oct 23, 2013 9:55:03 GMT -5
The insurance aspect is overlooked because the benefit isn't worth much. I had life insurance and both short and long term disability insurance privately. It didn't cost me anywhere near $13k a year.
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djAdvocate
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Post by djAdvocate on Oct 23, 2013 10:29:56 GMT -5
that is not how i view things. i could easily pay my employees 6.25% less than i do. i could easily pay them 6.25% more. what i actually pay them has more to do with their value than their cost. and i would pay that whether SS was 12.5% or 0. now, i really have no idea how bigger companies that have positions like "hiring manager" work, so i will have to take your word for it. but i can tell you that both on the books, and in my way of thinking, i view the 6.25% as "overhead", not "COGS". It may not be how you view it, but it's how most employers do. Taxes are part of an employee's total compensation package. This is part of the ECI discussion we've had. Higher employer-paid taxes means lower salary or other compensation. not in my case, but thanks.
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AgeOfEnlightenmentSCP
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Post by AgeOfEnlightenmentSCP on Oct 23, 2013 10:30:01 GMT -5
Actually it is not- a single line item. Standard Accounting practice does divide quite clearly where costs go here. COGS (Cost of Goods Sold) is determined before Gross Profit, and includes direct production employee cost. (production in a manufacturing co) Salaries are typically considered either as overhead or as COGS, depending on the function of the employee, but more often fall under Overhead Expense. Employer portion of FICA is typically found under Overhead Expense, and like Salaries, are typically figured after Gross Profit and before Net Profit (bottom line) I could easily keep my employees pay rate the same if I no longer had to pay half of the cost of SSI, at least in the short term. What I have to pay in the long term really depends more on the overall local market than anything else. I certainly agree that in the long term this could be influenced by whether or not FICA was still a factor, but it is absolutely NOT a direct factor in pay rates, at all. I understand the accounting practices and where the entries go- but in decision making, it's a single number.
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djAdvocate
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Post by djAdvocate on Oct 23, 2013 10:35:18 GMT -5
It may not be how you view it, but it's how most employers do. Taxes are part of an employee's total compensation package. This is part of the ECI discussion we've had. Higher employer-paid taxes means lower salary or other compensation. Or put another way- the total cost of an employee is a single line item made up of salary, benefits, cost of compliance- taxes and other considerations which has to add up to something that makes sense in terms of a business hiring, or keeping an employee. It's really not that complicated, nor difficult to understand. i have no problem understanding it. the point being raised is whether it is something i consider when i hire. and the answer is: no. it is not. what drives my hiring decisions is revenue. i have a target of revenue per employee. if i have N production employees working 40 hours per week, i look to hire when my overtime is governed by the equation H = (N+1)*40. at that point i don't honestly care what the cost of hiring is, because the cost of paying OT is far more. for example, i had all of my production guys working 8-10 hours per week extra. they get paid $25-40/hr. my new hire came in at $14/hr (probationary wage). at that wage, i could hire 2-3 guys, and still have lower payroll than i had before hiring.
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