As 2012 comes to a close, we here at MMC annually review the changes in tax rates that are in store for the next year. Employees will be seeing a slight decrease to their pay checks in 2013, due to the following:
- The government added a special Medicare tax to employees. They now will have to pay an extra .9% on any earnings over $200,000. Hopefully, this will help rejuvenate the Medicare system.
- In 2011, the social security rate for employees went down to 4.2%. However, this rate will increase back to 6.2% for 2013.
In 2012, MMC also experienced an increase in the amount of garnishments we received from the State of California. Many of these garnishments are for car registration or tax issues. As payroll garnishment is an easy way for the state to collect money, we advise you to be sure all your taxes are paid and your registrations are up to date.
Two additional changes to note:
- The base earnings for FICA and SDI are increasing for 2013. You can see the changes on the chart below:
|CA SDI Max||$95,585||$100,880|
As always, if you have any questions, please feel free to contact the payroll department. From the MMC payroll team, we wish you a Happy Holiday Season.The 401k maximum for 2013 is also increasing to $17,500.00 annually, with an additional $5,500.00 for employees age 50 and older. If you are looking for way to reduce your gross income, this is one option.