Eleanor is about to retire. She is trying to determine how her Social Security benefits will be taxed. What item is not included in benefit determination?

Question

Quizplus · Accepted Answer

When determining the taxation of Social Security benefits the number of married children would not be included in benefit determination. As of 2009, the 6.20 percent Social Security tax is computed on the first $106,800 of the employee's wages. The 1.45 percent Medicare tax is computed on the employee's total wages. Self-employment tax is imposed on self-employed people at the rate of 15.3 percent. This is a combination of 12.40 percent Social Security tax and 2.9 percent Medicare tax.

Eleanor Is About to Retire