Redford's salary was $129,000 in 2017.What would his total combined FICA tax (Social Security & Medicare)withheld from his salary be for the year?

Question

Quizplus · Accepted Answer

The Social Security tax rate for employees is 6.2% and the Medicare tax rate is 1.45%, for a total FICA tax rate of 7.65%.
$129,000 * 0.0765 = $9,857.25
However, the Social Security tax is only applied to the first $127,200 of earnings, so the maximum Social Security tax for 2017 is:
$127,200 * 0.062 = $7,886.40
The Medicare tax rate has no cap, so the full rate applies to all earnings.
Therefore, the total combined FICA tax withheld from Redford's salary would be:
$7,886.40 + ($129,000 - $127,200) * 0.0145 = $9,757.11, which rounds up to answer D.

Redford's Salary Was $129,000 in 2017