Employee's Rates • 7.65% on first $118,500 of income . 1.45% on income above $118,500 2016 FICA Tax Rates¹ Matching Rates Paid bythe Employer • 7.65% on first $118,500 paid in wages 1.45% on wages above $118,500 Self-Employed Rates • 13.3% on first $118,500 of net earnings . 2.9% on earnings above $118,500 1FICA taxes include Social Security and Medicare. The Social Security tax applies to the first $118,500 of income, while the Medicare tax applies to all income. Suppose a graphic designer earns $37,000 and is self-employed. How much will the designer have to pay in FICA taxes?

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter12: Current Liabilities
Section: Chapter Questions
Problem 16MC: An employee earns $8,000 in the first pay period. The FICA Social Security Tax rate is 6.2%, and the...
icon
Related questions
Question
i have no idea how to even start this problem
Employee's Rates
• 7.65% on first $118,500 of
income
. 1.45% on income above
$118,500
Matching Rates Paid bythe
Employer
●
2016 FICA Tax Rates¹
Search
Question Help: Message instructor
7.65% on first $118,500
paid in wages
1.45% on wages above
$118,500
Self-Employed Rates
1FICA taxes include Social Security and Medicare. The Social Security tax applies to the first $118,500 of
income, while the Medicare tax applies to all income.
Suppose a graphic designer earns $37,000 and is self-employed. How much will the designer have to pay in
FICA taxes?
13.3% on first $118,500 of
net earnings
. 2.9% on earnings above
$118,500
H
LM
Transcribed Image Text:Employee's Rates • 7.65% on first $118,500 of income . 1.45% on income above $118,500 Matching Rates Paid bythe Employer ● 2016 FICA Tax Rates¹ Search Question Help: Message instructor 7.65% on first $118,500 paid in wages 1.45% on wages above $118,500 Self-Employed Rates 1FICA taxes include Social Security and Medicare. The Social Security tax applies to the first $118,500 of income, while the Medicare tax applies to all income. Suppose a graphic designer earns $37,000 and is self-employed. How much will the designer have to pay in FICA taxes? 13.3% on first $118,500 of net earnings . 2.9% on earnings above $118,500 H LM
Expert Solution
steps

Step by step

Solved in 3 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Principles of Accounting Volume 1
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Century 21 Accounting General Journal
Century 21 Accounting General Journal
Accounting
ISBN:
9781337680059
Author:
Gilbertson
Publisher:
Cengage