Question

In describing FICA taxes, which (if any) of the following statements is incorrect? A.) If both...

In describing FICA taxes, which (if any) of the following statements is incorrect?

A.) If both spouses work, excess taxes need not result.

B.) Excess FICA taxes can be claimed as an income tax credit.

C.) The base amounts for 2021 probably will increase from the 2020 amounts.

D.) The base amounts for the Social Security and Medicare portions are the same.

E.) All of these are correct.

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Answer #1

D.) The base amounts for social Security and Medicare portions are the same

Explanation:

Taxes under FICA(Federal Insurance Contribution Act are composed of old age,survivors, and disability insurance taxes know as social security taxes , and the hospital insurance tax known as Medicare taxes.

Social Security Administration announced that the 2020 Social Security wage base will be $ 137700 , it's rate will be 6.2% and there is no limit to wages subject to Medicare tax.therefore all covered wages are subject to 1.45% tax.

So the above statement is incorrect based on FICA taxes.

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