2% Social Security tax cut... [Archive]

redfox

1-14-11, 1:23am

It may be small - but it's another stream to divert into savings!!

Jonathan

1-14-11, 9:52am

Just be ready to pay it back at income tax time. Sigh.

Tenngal

1-14-11, 10:49am

they put the 2% on the federal income tax deduction on our pay checks......from one column to another, still gone.

Bastelmutti

1-14-11, 11:39am

Perhaps offset by the increase in state income tax in IL just passed (for those of us in IL, I mean).

redfox

1-14-11, 1:02pm

Perhaps offset by the increase in state income tax in IL just passed (for those of us in IL, I mean).

Yeah, that was quite the increase. I am an advocate of state taxes, but a 66% jump seems pretty harsh.

ApatheticNoMore

1-14-11, 1:23pm

"The bill will increase the income tax on individuals from 3% to 5%" (IL taxes)

And the world's smallest violin plays ... I mean seriously folks, marginal state income taxes in CA are near 10% and no the budget is not balanced (and so yes further state income taxes are almost guaranteed, though a 66% increase would bring it over 16%)

But on topic, I've already diverted the 2% into the 401k (before I've even received my first paycheck with it), if I have to pay it back latter, well I've neither budgeted nor planned for that. :0 I didn't know. I still don't understand how it increases federal income taxes, even if it was previously deducted from income and now isn't, income taxes would only increase by the percentage of the 2% you pay in taxes right. not by the entire 2%? And if you put it in a 401k this is avoided entirely right?

Bronxboy

1-14-11, 7:56pm

From ApatheticNoMore
But on topic, I've already diverted the 2% into the 401k
Truthfully, since it directly increases the shortfall in Social Security, it is very hard to justify spending it. I've already diverted mine to a savings account.

Bastelmutti

1-14-11, 8:38pm

Yeah, that was quite the increase. I am an advocate of state taxes, but a 66% jump seems pretty harsh.

Well, if it keeps this state from flushing further down the toilet. I don't know. We'll see, I guess.

gimmethesimplelife

1-14-11, 8:49pm

Around January 1st I was reading an article in the Arizona Republic that made sense to me - that the future of the US is quite likely to be much more austere and that with the continuation of the tax cuts the next two years, this is a good time to ramp up savings to have some breathing room when and if things do become much more austere. I am working on cutting more out of my life as we speak as I want to have more money saved in my rainy day fund, so adding 2% more of my checks to savings when I start working again at the Grand Canyon is a no brainer, it really is. Rob of the North Rim May 2011

ljevtich

1-14-11, 11:04pm

Around January 1st I was reading an article in the Arizona Republic that made sense to me - that the future of the US is quite likely to be much more austere and that with the continuation of the tax cuts the next two years, this is a good time to ramp up savings to have some breathing room when and if things do become much more austere. I am working on cutting more out of my life as we speak as I want to have more money saved in my rainy day fund, so adding 2% more of my checks to savings when I start working again at the Grand Canyon is a no brainer, it really is. Rob of the North Rim May 2011
So Rob are you a park ranger too? And at the North Rim! Excellent! Might have to come out and visit you when the season gets started again.

ljevtich

1-14-11, 11:08pm

"The bill will increase the income tax on individuals from 3% to 5%" (IL taxes)

That is SO LOW - when I worked in North Carolina, it was much higher than that, and Utah was certainly higher too. Getting back 2% is like getting a raise for me. A pretty significant raise. It will be interesting to see what it is per paycheck but even an extra $300 a month will come in handy.

gimmethesimplelife

1-15-11, 1:24am

So Rob are you a park ranger too? And at the North Rim! Excellent! Might have to come out and visit you when the season gets started again.Hi, Laura, come on up and say hi, that would be great! No I am not a park ranger, I will be once again working in food and beverage at the North Rim Lodge there, in the restaurant slash bar there. Glad to get rehired as many did not and finding work in Phoenix is uber difficult right now is what I am experiencing.....