The gross payroll total for all employees of Yanni's Gyros this month is $120,000. $100,000 of the employees' wages fall below the Social Security limit. The total FICA taxes for both employees and employer is

Question

Quizplus · Accepted Answer

The FICA tax rate is 7.65% for both employees and employers, totaling 15.3%. The Social Security tax is 6.2% on wages up to the limit, and Medicare tax is 1.45% on all wages. For $100,000 below the limit, the Social Security tax is $6,200 (6.2% of $100,000) for both employee and employer, totaling $12,400. The Medicare tax on the full $120,000 is $1,740 (1.45% of $120,000) for both employee and employer, totaling $3,480. Adding both gives $15,880.

The Gross Payroll Total for All Employees of Yanni's Gyros