The Moonlighting Penalty: Incidence the Excess Social Security Tax  

Oleh:

Heavey, Jerome F.

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: Public Finance Review vol. 30 no. 4 (Jul. 2002), page 310-319.
Fulltext: 310PFR304.pdf (75.53KB)

Isi artikel

The social security tax is levied on wages and salaries up to a maximum annual amount, with employee and employer each paying the same amount of tax on the employee’s behalf. Workers earning more than the annual maximum taxable earnings and having more than one employer are vulnerable to excess social security tax withholding. The employee’s share of excess social security tax can be claimed as a (refundable) credit against the federal individual income tax, but the employer’s share cannot be claimed. If the employer’s share of the social security tax is borne by the worker, then the unrefunded excess employer’s tax is an additional tax on the worker. This additional tax is highly progressive, and its progressivity has increased in the past four decades.

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