| As an employer, you are responsible for a bevy of | | | | must collect it from every employee regardless of |
| red tape when it comes to your employees. Making | | | | whether they make one dollar or a million. |
| things even better, the rules and regulations regarding | | | | So, how is social security holding up these days? Can |
| that red tape gets changed a bit each year. | | | | you expect to actually receive anything when you |
| In 2008, one of the base line employment tax | | | | retire? Well, it obviously depends on when you will |
| standards is getting a tweak. It has to do with the | | | | retire. Although benefits are currently holding steady, |
| social security withholdings. In 2007, employers were | | | | the government slowly keeps bumping the retirement |
| required to withhold social security taxes equating to | | | | age at which you can actually claim full benefits. You |
| 6.2 percent of the employees wages on all wages up | | | | can expect this to continue. The current age is 65 |
| to $97,500. Any wages about that amount required no | | | | years and 10 months. |
| withholding. | | | | There is, of course, a fundamental problem with social |
| In 2008, the figures have been tweaked slightly. | | | | security. It has to do with population. The baby |
| Employers should be aware that the $97,500 number | | | | boomers constitute a bulge in the population. As they |
| has changed. It is now $102,000. This means, of course, | | | | age, the people following them are placed under more |
| that as an employer, you must withhold the 6.2 percent | | | | of a burden to support these retirees through social |
| for an additional $4,500 of those employees who earn | | | | security taxes. The numbers eventually will simply not |
| this type of money. | | | | work out. |
| The Medicare tax is also often lumped together with | | | | All of this essentially means there is a pretty good |
| the social security withholdings. Employers are required | | | | chance the money you are paying in to social security |
| to withhold 1.45 percent of the wages of an employee | | | | today will never be returned to you. Since you are |
| for Medicare. This amount has not changed in 2008 | | | | legally required to pay it whether you are an employer |
| because there is no cap on the tax collection. You | | | | or employee, there really isn't any alternative. |