Paycheck A Little Smaller? Here's Why...

You may have been spared from paying more in income taxes, but there still could have been a hit to your paycheck after the Fiscal Cliff Tax Deal was reached earlier this month. Here's all you need to know...

If you take a close look at your first 2013 paystub you will probably notice that Uncle Sam took a bigger chunk of your pay for Social Security.

Taxpayers got a temporary holiday from paying the full 6.2 percent beginning in 2011, but that is over thanks to the fiscal cliff tax deal reached earlier this month.

That legislation stopped the income tax hikes for most Americans, but the Social Security payroll tax holiday was allowed to expire. AOL explains it like this:

Social security is financed by a 12.4 percent tax on wages, with employers paying half and workers paying the other half. During the temporary holiday, the employee contribution was reduced to 4.2 percent in 2011 and 2012, saving a typical family about $1,000 a year. 

To see this in a different way, check out this bar graph showing how much more in taxes people will have to pay by income.

Closer to home, we asked on Facebook how much lighter your paycheck was and how you felt about it. Here’s what people had to say:

Brenda Bredahl Um...quickly we forgot that we got a 2 percent increase in pay from the social security in 2010 for federal economic stimulus ... Now that tax holiday is over that's all

Christina Andersen if they tax us then they should tax welfare checks too.

Mike Bergman Tax welfare. Because people on welfare who have kids can get tax credits for having kids with never paying taxes. I believe you can this a evil rich person loop hole

Arwen Hall It's an ignorant suggestion to say "welfare checks" should be taxed! that's asking for more government, not less. Just because a welfare recipient does not pay income taxes does not mean they don't pay any taxes. Recipients of "welfare checks" do pay such levies as sales tax, gasoline tax, phone and utility taxes. Many politically well-connected corporations are also parasitically draining their share of fiscal blood from your paycheck before you ever see it. It’s called corporate welfare. The government spends more on corporate welfare subsidies than social welfare programs.

Casey Rouse I'll pay over $1,000 more into a dysfunctional ss system this year because of the hijacking of our social security by politicians. It should be our own account that the ignorant politicians can't touch. Add the 12% tax increase from mayor Dickert and the worst councilmen in the world, and you have a perfect storm against job growth in Racine.

Monisa Cole January 15, 2013 at 04:00 PM
It seems like the harder working people work the more they get taxed. Why penalized hard working people, we go to work because we need to not but we have nothing better to do with our time.
Keith R. Deschler January 16, 2013 at 12:39 PM
This is a perfect illustration of why we need to phase out the federal income tax system, and replace it with a simple progressive sales tax, applicable to all consumption above the poverty line. No more withholding at the federal level on wages and salaries. Your money is your money, and you pay taxes only when you spend ablove the poverty line, thanks to the monthly prebate sent to you. For more information, go to www. fairtax.org
patchreader 123 January 22, 2013 at 12:00 AM
What a joke. The fiscal cliff deal entirely failed to address the tax loopholes that allow multinational corporations to avoid the payment of federal income taxes. In 2008, President Obama made a campaign promise "to close corporate tax loopholes the lobbyists put in." Well, let's see: In 2011, President Obama appointed Boeing CEO James McNerey to his export council. Yet, in 2010, Boeing earned $4.3 billion in profits and paid negative 0.1% in federal income taxes (due to the tax loopholes Obama promised to fix). In 2011, President Obama also appointed Ford CEO Alan Mulally to the same export council. Yet, in 2010, Ford earned $6.6 billion in profits and paid negative 1.7 % in federal income taxes (again due to the tax loopholes Obama promised to fix). In 2011, President Obama thereafter appointed Honeywell CEO David Cote to his deficit reduction committee. Yet in 2010, Honeywell earned $1.25 billion in profits, paid $0.00 in federal income taxes and received a tax refund of $482 million. Finally, in 2011, President Obama appointed G.E. CEO Jeff Immelt to his council on jobs and competitiveness. Yet, in 2010m GE earned $5.1 billion in profits and paid $0.00 in federal income tax. It should be noted that G.E. spent about $33 million in lobbying our fine government officials to ensure that the tax laws are favorable to it.
patchreader 123 January 22, 2013 at 12:01 AM
President Obama’s 2012 State of the Union address included the following statement: “No American company should be able to avoid paying its fair share of taxes by moving jobs and profits overseas,” … “From now on, every multinational company should have to pay a basic minimum tax.” Yet, in mid-December of 2012, CEOs of the biggest multinationals visited the White House for closed-door meetings regarding the fiscal cliff. Two weeks later, a deal was drafted in the Senate, passed by Congress and signed by Obama that included a total of $0.00 in revenue from multinational corporations to help our staggering deficit. Did Obama make good on his promise? NO. And the federal deficit “tin-can” has again been kicked down the road by both parties, leaving our children and grandchildren to deal with it. Absolutely shameful! Our “representative” form government is on the take and completely broken.


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