The Social Security Tax funds the nation's retirement and disability programs. Did you know it was introduced in 1935 as part of the New Deal, marking a significant shift in social welfare?
Medicare Tax helps provide healthcare benefits to the elderly and certain individuals with disabilities. Its inception dates back to 1966 when President Lyndon B. Johnson signed it into law.
Employers pay the Federal Unemployment Tax to fund unemployment benefits for workers who lost their jobs. The program was established in 1939, following the Great Depression.
State Unemployment Tax complements the federal program by offering additional unemployment benefits. Each state administers its own system, varying in rates and regulations.
The SSN was originally created for tracking workers' earnings and benefits. However, its use has evolved, and it's now an essential identification number for various purposes.
High-income earners might think they stop paying Social Security Tax after a certain threshold, but that's not true. All income up to the cap limit is subject to the tax.
Individuals with high incomes might be surprised by an additional Medicare Surtax, aimed at funding the Affordable Care Act, affecting both employers and employees.
Employers who pay their state unemployment taxes on time can receive a credit of up to 5.4% against their Federal Unemployment Tax.