How much more can one expect to spend on payroll taxes in 2012? The Wall Street Journal’s Real Time Economics blog puts that number at $1,001.08.
No matter which party comes out on top in the November elections, nearly every working American is likely to pay higher taxes in 2013 than 2012.
Lost in the debate over the fiscal cliff and whether the Bush tax cuts should be extended for all Americans or just those who make more than $250,000 is the expiration of a tax holiday both parties quietly support.
In an effort to stimulate demand and put more money into consumers’ pockets, Congress temporarily lowered the Social Security tax withholding rate to 4.2% from 6.2% for 2011 and earlier this year extended it into 2012. The holiday in the so-called payroll tax is set to expire at the end of this year, and so far neither party has expressed much interest in another extension.