Social Security and Medicare Taxes pp. 124-125 2-4 SECTION.

Social Security and Medicare Taxes

pp. 124-1252-4SECTION

• Click to edit Master text styles

• Second level

• Third level

• Fourth level

• Fifth level

2

SECTION

Copyright © Glencoe/McGraw-Hill MBA, Section 2-4, Slide 2 of 14

2-4

Section ObjectiveSection ObjectiveWork out:

• the amount of income withheld for Social Security taxes

• the amount of income withheld for Medicare taxes


• Second level

• Third level

• Fourth level

• Fifth level

3

SECTION


2-4

Social Security (p. 124)

A federal government program to pay for retirement and disability benefits, financed by taxes.

Medicare (p. 124)

A federal government program to provide hospitalization insurance, financed by taxes.

Key Words to KnowKey Words to Know


• Second level

• Third level

• Fourth level

• Fifth level

4

SECTION


2-4

Tax Withheld = Gross Pay × Tax Rate

FormulaFormula


• Second level

• Third level

• Fourth level

• Fifth level

5

SECTION


2-4

Jack’s Jackpot p. 124Jack’s Jackpot p. 124

Why is Social Security important?


• Second level

• Third level

• Fourth level

• Fifth level

6

SECTION


2-4

Otis Hassan’s gross biweekly pay is $648.00. His earnings to date for the year total $15,228.

What amount is deducted from his pay this week for Social Security? For Medicare? What is the total deduction?

Example 1Example 1


• Second level

• Third level

• Fourth level

• Fifth level

7

SECTION


2-4

Find the Social Security tax withheld.

Gross Pay × Tax Rate

$648.00 × 6.2% = $40.176 = $40.18

Example 1 Answer: Example 1 Answer: Step 1Step 1


• Second level

• Third level

• Fourth level

• Fifth level

8

SECTION


2-4

Find the Medicare tax withheld.

Gross Pay × Tax Rate

$648.00 × 1.45% = $9.396 or $9.40



• Second level

• Third level

• Fourth level

• Fifth level

9

SECTION


2-4

Find the total deduction.

Social Security Tax + Medicare Tax

$40.18 + $9.40 = $49.58



• Second level

• Third level

• Fourth level

• Fifth level

10

SECTION


2-4

Find the Social Security and Medicare taxes withheld for this pay period.

Tom Mendoza.Monthly salary $4,800.$52,800 earned this year to date.How much deducted this pay period for Social Security? For Medicare?

Practice 1Practice 1


• Second level

• Third level

• Fourth level

• Fifth level

11

SECTION


2-4

For Social Security: $297.60

For Medicare: $69.60

Practice 1 AnswerPractice 1 Answer


• Second level

• Third level

• Fourth level

• Fifth level

12

SECTION


2-4

Stephanie Metcalf earns $91,992 a year. Her salary is paid monthly. What are her year-to-date earnings for November? How much is deducted from her check in November for Social Security? For Medicare?

How much is deducted from her check in December for Social Security? For Medicare?

Practice 2Practice 2


• Second level

• Third level

• Fourth level

• Fifth level

13

SECTION


2-4

Year-to-date earnings for November: $84,326

Social Security deduction in November: $475.29

Medicare deduction in November: $111.16

Social Security deduction in December: $35.59

Medicare deduction in December: $111.16

Practice 2 AnswerPractice 2 Answer


• Second level

• Third level

• Fourth level

• Fifth level

14

SECTION


2-4• Assignment -

Social Security and Medicare Taxes

2-4END OF SECTIONEND OF SECTION

Social Security and Medicare Taxes pp. 124-125 2-4 SECTION.

Documents

Transcript of Social Security and Medicare Taxes pp. 124-125 2-4 SECTION.