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Social Security Taxes in 2010
Tax rates: The rate is 6.2% on the first $106,800 of an employee’s taxable earnings in year 2010.
Medicare tax of 1.45% applies on every dollar of every employee’s taxable earnings. A total of 7.65% is matched by employers up to $106,800, plus 1.45% Medicare tax on amounts over $106,800.
Employment and Social Security benefits: Retirees under age 66 can earn up to $14,160 in 2010 without loss of Social Security benefits; above $14,160 they lose $1 in benefits for every $2 of earnings. There is no cutback in benefits after age 66.
Taxation of Social Security benefits: Up to half of Social Security benefits is taxable for single persons with “provisional income” over $25,000 ($32,000 for joint returns). Up to 85% is taxable if income exceeds $34,000 (singles) or $44,000 (joint returns).
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