Quote:
Originally Posted by cillovely
FICA tax went from 4.2% to 6.2% And with that tax it also hurts employers since they have to match that tax and pay Uncle Sam for our phantom SS benefits that will maybe be there when we retire.
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The FICA rate had previously been 6.2%; the reduction to 4.2% was a temporary measure. Anyone who was informed about the matter knew that it was scheduled to revert to the 6.2% rate at the beginning of this year.
Whether or not future SS benefits are "phantom" or not is a matter of debate, but I can tell you one thing for sure: the less money that is paid into SS (i.e. the FICA tax that employees and employers pay), the less chance there is that you'll get the benefits that you think you're entitled to. Wanting to pay less money and get the same benefits is not a sustainable financial strategy, folks.
Edited to add: this article from
Forbes does a really good job of explaining it.
http://www.forbes.com/sites/anthonyn...-tax-increase/