Asteria earned a $25,500 salary as an employee in 2018.How much should her employer have withheld from her paycheck for FICA taxes? (Rounded to the nearest whole dollar amount).

Question

Quizplus · Accepted Answer

FICA taxes refer to Social Security and Medicare taxes that are withheld from an employee's paycheck. In 2018, the Social Security tax rate was 6.2% on wages up to $128,400 and the Medicare tax rate was 1.45% on all wages. Therefore, Asteria's employer should have withheld 6.2% of $25,500 for Social Security taxes ($1,581) and 1.45% of $25,500 for Medicare taxes ($370), for a total of $1,951. Therefore, the correct answer is choice C.

Asteria Earned a $25,500 Salary as an Employee in 2018