Today we will take a look at the expiration of the payroll tax holiday and 2013 withholding tables.
Back in 2011, the government temporarily lowered the social security payroll tax rate from 6.2% down to 4.2%. This was then extended for 2012.
Starting in 2013, unless Congress does something totally unexpected, this temporary cut will expire and the rate will return to 6.2%.
For regular income tax withholding for 2013, the IRS has not issued new withholding tables yet as they are waiting for Congress to come to a conclusion on what the tax rates will be for 2013. In the meantime, you should continue to use the 2012 tables for any payroll until the IRS does release new tables.
We will continue watching the year-end tax changes very closely and will release a special edition as soon as an agreement is reached.
Happy New Year!!!
Disclaimer: The items included in the Tax Tip Tuesday Video Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation. IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advise contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.