The Social Security Payroll Tax Does Not Hit All Income
The Social Security payroll tax brings in over 87% of the revenue in order to fund Social Security benefits. Sean Williams writes here about the seven sources of income NOT subject to the 12.4% payroll tax (split evenly between employee and employer at 6.2% each). The exempt sources of income are: Dividend income, Bond income, Rental income, Capital gains, Certificate of Deposit interest income, Student income earned while attending a college or university, and wages earned above $132,900 annually (the 2019 wage cap). Read the full piece here.
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