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What are FICA​ taxes? Describe the portions of FICA and explain what they pay for. Who...

What are FICA​ taxes? Describe the portions of FICA and explain what they pay for. Who pays​ FICA?​

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Answer #1

FICA stands for Federal Insurance Contributions Act. Generally, it is deducted from the employee’s salary by the employer to pay for. The employer and employee equally contribute to the FICA.

The general proportion for the FICA on employer and employee part is 6.2% for Social security tax and 1.45% for Medicare tax. Thus, the total is 7.65% employer contribution and the same 7.65% is deducted from employee's salary.

If a person is a high earning employee, he/she must contribute 0.9% Medicare surtax. An employer does not pay this 0.9% Medicare surtax for high earning employees.

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