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FICA - Quick Update

Discussion in 'Business Operations' started by ToddH, Jan 2, 2013.

  1. ToddH

    ToddH LawnSite Silver Member
    Posts: 2,184

    Just cut the first payroll of the year.

    If you have not heard but in the so called fiscal cliff deal they let the 2% FICA cut expire. This means you have to withhold the full 6.2% from the employee check. The amount the company have to pay has not changed. This also means the SE tax is up 2% as well.

    Quickbooks is on this already. Checks cut payroll and bonus checks last week were different than those cut today.

    Happy New Year. :laugh:
  2. DanaMac

    DanaMac LawnSite Fanatic
    Posts: 13,156

    It's amazing how many people - employees and employers both - didn't realize this. Employees withholdings are going to go back up due to it, but it's not an added tax or raise in rates. It was a temporary tax CUT for the last two years that is put back in place. Neither of my my employees realized until I told them, that as an employer, I have to match their SSI contribution, and even though their rate was cut, MINE stayed the same.
  3. ToddH

    ToddH LawnSite Silver Member
    Posts: 2,184

    My new guy asked me about this just before break. I suppose one of the other employees told him. I make no bones about telling them that insurance is a percent based on wages. I tell them about SUTA / FUTA and FICA too.

    They have a clue what I charge, particularly residential so it may seem like I am a fat cat. They also know about what the equipment cost, they purchase the fuel so they know that. I think they know I treat them pretty fair.

    I wish I could pay them more.

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