Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The FICA payroll tax is involuntary, meaning you have no say in whether it comes out of your paycheck or how much comes out. The

image text in transcribed
The FICA payroll tax is involuntary, meaning you have no say in whether it comes out of your paycheck or how much comes out. The original act was enacted in 1937 to fund Social Security so that workers would have retirement in their older age. Thirty years later, they added an additional tax to fund Medicare, designed to cover workers' medical costs in their retirement. The original FICA tax rate was 2% (half paid by employees and the other half paid by employers). The FICA rate has steadily increased since that time. For most of the 2000 's, the tax rate has been 15.3%, half paid by the employees (7.65\%) and another 7.65% that is matched by the employers. Given FICA's original purpose and our current Social Security and Medicare system, does this increase since 1937 seem reasonable or is it not enough? Explain. (6pts)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Comparative International Accounting Subsequent Edition

Authors: Christopher Nobes, R. H. Parker

5th Edition

0137364636, 9780137364633

More Books

Students also viewed these Accounting questions

Question

What requirement did Health Canada initially require of Aurora?

Answered: 1 week ago