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Social security taxes when income > $90,000



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Feb 25, 2006 12:09 PM

Social security taxes when income > $90,000


Those of you who work for an employer do they automatically quit taking out the 7.5% social security taxes when your income goes over the $90,000 mark, or do you have to remind them?


Thanks,

soliant


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4 Comments
No. 1
Old Feb 25, 2006, 12:21 PM

Default Re: Social security taxes when income > $90,000
Well at some point during the year you max out your contributions to Social security, I would think you hit that point at about October-November. Then you don't have to contribute until the start of the next year.
But if you just started a new job making >$90k/yr, they should automatically take the social security out.
WG
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No. 2
from ZASHAGALKA
Old Feb 25, 2006, 05:21 PM
Updated Feb 25, 2006 at 05:30 PM by ZASHAGALKA

Default Re: Social security taxes when income > $90,000
Actually, that number rises slightly every year.

If all your income was from the same employer, they should automatically stop. It is a feature of most of the automated payroll systems.

*edit, looked it up: 90,000 for 2005 (max tax: 5580), 94,200 for 2006 (max tax 5840.40).

From FAQ from SSA.gov:
"I worked more than one job during the year and paid too much in Social Security tax. How do I claim a refund?

When you have more than one job in a year, each of your employers must withhold Social Security taxes on your wages without regard to what the other employers may have withheld. You may then end up with total Social Security taxes withheld that exceed the maximum. You can claim a refund of the excess taxes that were withheld on form 1040 when you file your personal income tax return with the Internal Revenue Service.

You should contact the IRS at http://www.irs.gov for more information on how to claim a refund of overpaid Social Security taxes."

~faith,
Timothy.
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No. 3
from jwk
Old Feb 25, 2006, 05:24 PM

Default Re: Social security taxes when income > $90,000
Originally Posted by ZASHAGALKA
Actually, that number rises slightly every year. It was 92,500 for 2005, if I remember correctly, and will probably be slightly higher in 2006.

If all your income was from the same employer, they should automatically stop. It is a feature of most of the automated payroll systems.

If you earn that much from 2 different jobs, you can probably get your employer to stop if you can prove you already paid max - which would mean showing them your payroll records from the other job. Or, I think you can ask Uncle Sam for a refund of the overpayment, but I'm not sure how to do this.

~faith,
Timothy.
The Social Security portion, about 6.2%, has a cap. The Medicare portion, which I think is 1.45%, has no cap - all earned income is subject to it.
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No. 4
from soliant12
Old Feb 25, 2006, 06:50 PM

Default Re: Social security taxes when income > $90,000
Thanks for the info


Originally Posted by ZASHAGALKA
Actually, that number rises slightly every year.

If all your income was from the same employer, they should automatically stop. It is a feature of most of the automated payroll systems.

*edit, looked it up: 90,000 for 2005 (max tax: 5580), 94,200 for 2006 (max tax 5840.40).

From FAQ from SSA.gov:
"I worked more than one job during the year and paid too much in Social Security tax. How do I claim a refund?

When you have more than one job in a year, each of your employers must withhold Social Security taxes on your wages without regard to what the other employers may have withheld. You may then end up with total Social Security taxes withheld that exceed the maximum. You can claim a refund of the excess taxes that were withheld on form 1040 when you file your personal income tax return with the Internal Revenue Service.

You should contact the IRS at http://www.irs.gov for more information on how to claim a refund of overpaid Social Security taxes."

~faith,
Timothy.
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