Social Security Tax Update
For information regarding the social security tax rate reduction and how it affects your paycheck, please see below. Check back often as updates will be posted as we receive them from the State Controller's Office.
Update December 20, 2012
The Middle Class Tax Relief and Job Creation Act of 2012 (Tax Relief Act of 2012), signed into law on February 22, 2012, extended the reduction in the social security tax rate paid by employees for wages through December 31, 2012. In accordance with the Tax Relief Act of 2012, the employee social security rate remained at 4.2% with employers continuing to pay the full 6.2% rate for their portion of the social security tax.
Since the law is set to expire on December 31, 2012, and Congress has yet to pass a new bill extending the reduction, the social security tax rate for both employees and employers is scheduled to be 6.2% effective January 1, 2013. As of Master Payroll Cut-Off for the December pay period (December 19th), the reduction has not been extended which means that employees will have a 2% increase in contributions to social security, reducing their net pay by the same amount for the December 2012 pay warrant (issue date January 1, 2013).
If a new bill extending the reduction is passed in the future, employees will receive an adjustment on a subsequent pay warrant.