SOCIAL SECURITY WAGE BASE REMAINS AT $106,800 FOR 2010

The Social Security Administration has announced that the wage base for computing the Social Security tax (OASDI) in 2010 remains unchanged at $106,800.

The Federal Insurance Contributions Act (FICA) imposes two taxes on employers, employees, and self-employed workers—one for Old Age, Survivors and Disability Insurance (OASDI; commonly known as the Social Security tax), and the other for Hospital Insurance (HI; commonly known as the Medicare tax).

The FICA tax rate for employees and employers is 7.65% each—6.2% for OASDI and 1.45% for Medicare. For self-employed workers, the FICA tax is 15.3%—12.4% for OASDI and 2.9% for Medicare. There is a maximum amount of compensation subject to the OASDI tax, but no maximum for Medicare.

I hope this information is helpful.

Please contact the Law Offices of William H. Copperthwaite Jr., L.L.C. if you have any questions.

Please note that the information contained in this summary is intended for informational purposes only and is not to be considered tax/legal advice. For specific advice, please contact the Law Offices of William H. Copperthwaite Jr., L.L.C.