1. Social Security and Medicare Taxes pp. 124-125 2-4 SECTION

2. Click to edit Master text styles Second level Third level Fourth level Fifth level 2 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 2 of 14 2-4 Section Objective Work out: the amount of income withheld for Social Security taxes the amount of income withheld for Medicare taxes

3. Click to edit Master text styles Second level Third level Fourth level Fifth level 3 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 3 of 14 2-4 Social Security (p. 124) A federal government program to pay for retirement and disability benefits, financed by taxes. Medicare (p. 124) A federal government program to provide hospitalization insurance, financed by taxes. Key Words to Know

4. Click to edit Master text styles Second level Third level Fourth level Fifth level 4 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 4 of 14 2-4 Tax Withheld = Gross Pay × Tax Rate Formula

5. Click to edit Master text styles Second level Third level Fourth level Fifth level 5 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 5 of 14 2-4 Jack’s Jackpot p. 124 Why is Social Security important?

6. Click to edit Master text styles Second level Third level Fourth level Fifth level 6 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 6 of 14 2-4 Otis Hassan’s gross biweekly pay is $648.00. His earnings to date for the year total $15,228. What amount is deducted from his pay this week for Social Security? For Medicare? What is the total deduction? Example 1

7. Click to edit Master text styles Second level Third level Fourth level Fifth level 7 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 7 of 14 2-4 Find the Social Security tax withheld. Gross Pay × Tax Rate $648.00 × 6.2% = $40.176 = $40.18 Example 1 Answer: Step 1

8. Click to edit Master text styles Second level Third level Fourth level Fifth level 8 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 8 of 14 2-4 Find the Medicare tax withheld. Gross Pay × Tax Rate $648.00 × 1.45% = $9.396 or $9.40 Example 1 Answer: Step 2

9. Click to edit Master text styles Second level Third level Fourth level Fifth level 9 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 9 of 14 2-4 Find the total deduction. Social Security Tax + Medicare Tax $40.18 + $9.40 = $49.58 Example 1 Answer: Step 3

10. Click to edit Master text styles Second level Third level Fourth level Fifth level 10 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 10 of 14 2-4 Find the Social Security and Medicare taxes withheld for this pay period. Tom Mendoza. Monthly salary $4,800. $52,800 earned this year to date. How much deducted this pay period for Social Security? For Medicare? Practice 1

11. Click to edit Master text styles Second level Third level Fourth level Fifth level 11 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 11 of 14 2-4 For Social Security: $297.60 For Medicare: $69.60 Practice 1 Answer

12. Click to edit Master text styles Second level Third level Fourth level Fifth level 12 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 12 of 14 2-4 Stephanie Metcalf earns $91,992 a year. Her salary is paid monthly. What are her year-to- date earnings for November? How much is deducted from her check in November for Social Security? For Medicare? How much is deducted from her check in December for Social Security? For Medicare? Practice 2

13. Click to edit Master text styles Second level Third level Fourth level Fifth level 13 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 13 of 14 2-4 Year-to-date earnings for November: $84,326 Social Security deduction in November: $475.29 Medicare deduction in November: $111.16 Social Security deduction in December: $35.59 Medicare deduction in December: $111.16 Practice 2 Answer

14. Click to edit Master text styles Second level Third level Fourth level Fifth level 14 SECTION Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 14 of 14 2-4 Assignment -

15. Social Security and Medicare Taxes 2-4 END OF SECTION