Archive for January, 2010

Your paycheck will either shrink by a few dollars or grow by nearly $40 per week in 2011, thanks to the tax compromise lawmakers passed earlier this month.  Part of this tax reduction will start in January and decreases social security taxes from 6.2% to 4.2%.

For most tax filers — 73 million to be exact — it will mean more money in their weekly paycheck, according to numbers from the Tax Policy Center, a nonpartisan research group.

Individuals who make $50,000 will see a bump of $1,000 in take-home pay in 2011.

Higher income earners will fare even better. Individuals making $100,000 will see a $2,000 increase in take home pay — or $38.46 per week. Couples making $100,000 will see an increase of $23.08 per week.

It’s all part of the the $860 billion tax package that included extending the Bush tax cuts, which are across the board reductions in the income tax rate, tax cuts for businesses, and other tax breaks. Lawmakers passed tax cuts despite concerns of a ballooning deficit because they felt higher taxes at this time would derail the fragile economic recovery.

Read more at cnn.com Income Tax Relief