The reduced 4.2% rate for employee Social Security taxes that was in effect for 2011 and 2012 has expired. The employee Social Security rate will return to 6.2% for 2013 wages to the taxable wage limit of $113,700. Consequently, employees’ net pay under the taxable wage limit will decrease accordingly. The maximum Social Security tax an employee would pay will be $7049.40 for 2013. The increase is the result of the expiration of the temporary tax cut pushed by the Obama administration to help the economy rebound.

 

For more information, please review the regulatory news on IRS web site http://www.irs.gov. As always, employees should seek the advice of a qualified attorney or tax professional to assist in determining how the new tax law will affect their particular circumstances.