Social Security Tax Is Going Up for Millions in 2017

Social Security Tax Is Going Up for Millions in 2017 President-elect Donald Trump has promised lower taxes and a simplified tax code for all Americans. But during Trump’s first year in office, a scheduled adjustment to Social Security payroll taxes means that millions of workers will see hundreds of extra dollars automatically deducted from their paychecks. The paychecks of many affected workers will shrink by over $500 during the course of 2017. Self-employed workers may be on the hook for $1,000 or more in extra payroll taxes this year. What’s causing the bump in taxes? As a Bloomberg article explained, in recent years, workers have paid Social Security payroll taxes of 6.2% only on the first $118,500 in earnings. In 2017, the rate stays the same, but workers must pay that 6.2% on the first $127,200 they make. It’s the biggest change in the tax in more than three decades, and the gist is that the extra level of taxable income could result in as much as $539 disappearing from each affected worker’s paycheck in 2017. Self-employed workers, who bear the full brunt of Social Security payroll taxes with no help from an employer, could pay more than $1,000 extra this year due to the increase in the taxable minimum. Note that low-earning workers aren’t affected at all by the changes. Only those earning more than $118,500 will be impacted. But it is a very large groupâ€"estimated at 12 million workersâ€"that will be seeing their paychecks slashed, by way of an increase in their payroll taxes. Video Player is loading.Play VideoPlayMuteCurrent Time  0:00/Duration  0:00Loaded: 0%Stream Type  LIVESeek to live, currently playing liveLIVERemaining Time  -0:00  SharePlayback Rate1xChaptersChaptersDescriptionsdescriptions off, selectedCaptionscaptions settings, opens captions settings dialogcaptions off, selectedAudio TrackFullscreenThis is a modal window. This video is either unavailable or not supported in this browser Error Code: MEDIA_ERR_SRC_NOT_SUPPORTED Technical details : No compatible source was found for this media. Session ID: 2019-12-31:a3ff6b781b0966b335713ca6 Player Element ID: jumpstart_video_1 OK Close Modal DialogBeginning of dialog window. Escape will cancel and close the window.TextColorWhiteBlackRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentBackgroundColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentTransparentWindowColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyTransparentSemi-TransparentOpaqueFont Size50%75%100%125%150%175%200%300%400%Text Edge StyleNoneRaisedDepressedUniformDropshadowFont FamilyProportional Sans-SerifMonospace Sans-SerifProportional SerifMonospace SerifCasualScriptSmall CapsReset restore all settings to the default valuesDoneClose Modal DialogEnd of dialog window.PlayMuteCurrent Time  0:00/Duration  0:00Loaded: 0%Stream Type  LIVESeek to live, currently playing liveLIVERemaining Time  -0:00  Playback Rate1xFullscreenClose Modal DialogThis is a modal window. This modal can be closed by pressing the Escape key or activating the close button.Close Modal DialogThis is a modal window. This modal can be closed by pressing the Escape key or activating the close button.