Presentation on theme: "TAXES. Bell Work ◦ There are 76,771 students at ASU. 62,089 of the students at ASU are undergraduates. What percentage of the students at ASU are undergrads?"— Presentation transcript:
Bell Work ◦ There are 76,771 students at ASU. 62,089 of the students at ASU are undergraduates. What percentage of the students at ASU are undergrads?
Taxes ◦ Federal Insurance Contributions Act (FICA): insurance program through employer and US Government. ◦ FICA taxes are split between employee and employer
Social Security ◦ Social Security: provides income for people after they retire (covers 90% of American jobs) ◦ Your money is not being set aside for you in an account; amounts are being recorded and used as current benefits. ◦ The amount of Social Security you pay depends on ◦ S.S. percentage ◦ Maximum Taxable Income for that year: any income greater than that amount is not subject to S.S. tax.
Medicare ◦ Medicare is the nation’s largest health insurance program for people 65 years and older. ◦ Medicare is tax paid on all of your income (unlike Social Security tax which is only up to a certain amount).
Concerns with Social Security… ◦ Any thoughts? ◦ Only solvent until 2033, after that it would pay 75% of promised benefits.
IMPORTANT Social Security Number: unique 9-digit that belongs to only you; used to keep track of the amount you pay into Social Security and Medicare 1.Memorize your SSN 2.Don’t give out your SSN on the Internet 3.Ask why its needed before giving it out 4.Keep it secret; keep it safe
Example 1 ◦ Clay earned $50,000 last year in 2014. The Social Security tax was 6.2% of income up to $117,000. His Medicare tax was 1.45%. ◦ How much did Clay pay in FICA taxes last year?
On the boards ◦ TJ made $2,500,322 last year. The Social Security tax rate was 6.2% to the maximum income of $117,000. Medicare was 1.45% of total income. ◦ How much did T.J pay in FICA taxes last year?
2014/15 FICA ◦ 2014: Maximum taxable income was $117,000 ◦ 2015: Maximum taxable income is $118,500 ◦ S.S. tax remains 6.2% ◦ Medicare remains at 1.45% ◦ Aaron earned $115,000 in 2014. This year he expects to make $119,000. How much more should Aaron expect to pay in FICA taxes in 2015?
Example 2 ◦ In 2006, Ha Ha paid $5,930 in Social Security tax. If the Social Security tax rate was 6% to the maximum income of $95,000 that year, what was Ha Ha’s taxable income?
◦ In 2008, Eddie paid $3,875 in Social Security tax. If the Social Security tax rate was 6.2% to the maximum income of $94,200 that year, what was Eddie’s taxable income?