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6 September, 11:02

Calculate Social Security taxes, Medicare taxes, and FIT for Jordon Barrett. He earns a monthly salary of $11,300. He is single and claims 1 deduction. Before this payroll, Barrett's cumulative earnings were $128,070. (Social Security maximum is 6.2% on $128,400 and Medicare is 1.45%.) Calculate FIT by the percentage method. (Use Table 9.1 and Table 9.2) (Round your answers to 2 decimal

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  1. 6 September, 14:52
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    1) social security taxes = (accumulated earnings - social security maximum) x 6.2% = ($139,370 - $128,070) x 6.2% = $700.60

    2) medicare taxes = monthly earnings x 1.45% = $11,300 x 1.45% = $163.85

    3) in order to calculate federal income taxes, I used the 2019 tables and allowance:

    2019 allowance = $350 per person

    monthly paycheck between $7,333 - $13,710

    must withhold $1,198.46 plus 24% in excess of $7,333

    federal income taxes under percentage method = $11,300 - $350 (1 monthly allowance 2019) = $10,950

    $1,198.46 + [ ($10,950 - $7,333) x 24%] = $1,198.46 + $868.08 = $2,066.54

    For 2020, there are no more personal allowances.
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Home » Business » Calculate Social Security taxes, Medicare taxes, and FIT for Jordon Barrett. He earns a monthly salary of $11,300. He is single and claims 1 deduction. Before this payroll, Barrett's cumulative earnings were $128,070. (Social Security maximum is 6.
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