Question

Len Mast is married with three allowances. His weekly gross pay is $1,250. He will not reach the maximum taxable salary for Social Security purposes.

1. What is the amount that he will have deducted for Social Security taxes?

2. What is the amount that he will have deducted for Medicare taxes?

3. Using the percentage method, what is the amount that he will have deducted for FIT (Federal Income Tax)?

SOCIAL SECURITY TAX RATE: 6.2% MEDICARE TAX RATE: 1.45% MAXIMUM TAXABLE SALARY: $110,100 Payroll Period Weekly Biweekly Semimonthly Monthly Quarterly Semiannually Annually Daily or miscellaneous (each day of the payroll period) One Withholding Allowance $ 73.08 146.15 158.33 316.67 950.00 1,900.00 3,800.00 14.62 TABLE 1—WEEKLY Payroll Period (a) SINGLE person (including head of household) (b) MARRIED person, If the amount of wages (after If the amount of wages (after subtracting withholding The amount of income tax subtracting withholding allowances) is: to withhold is: allowances) is: Not over $41 $0 Not over $156 Over But not over- of excess over Over But not over- $41 - $209 $0.00 plus 10% -$41 $156 -$490 $209 -$721 $16.80 plus 15% -$209 $490 -$1,515 $721 - $1,688 $93.60 plus 25% -$721 $1,515 -$2,900 $1,688 -$3,477 $335.35 plus 28% -$1,688 $2,900 -$4,338 $3,477 - $7,510 $836.27 plus 33% -$3,477 $4,338 -$7,624 $7,510 $2,167.16 plus 35% -$7,510 $7,624 The amount of income tax to withhold is: $0 of excess over- $0.00 plus 10% -$156 $33.40 plus 15% -$490 $187.15 plus 25% - $1,515 $533.40 plus 28% - $2,900 $936.04 plus 33% -$4,338 $2,020.42 plus 35% -$7,624
4. What is his net pay?

Answer 1

1
Deduction for Social Security taxes	77.50	=1250*6.2%
2
Deduction for Medicare taxes	18.13	=1250*1.45%
3
Gross pay	1250.00
Less: Withholding allowance	219.24	=73.08*3
Taxable pay	1030.76
Deduction for FIT (Federal Income Tax)	114.51	=33.40+(1030.76-490)*15%
4
Gross pay	1250.00
Less: Deductions
Social Security taxes	77.50
Medicare taxes	18.13
Federal Income Tax	114.51
Total Deductions	210.14
Net pay	1039.86