Therefore, an employee may be held responsible for their employer's failure to pay FICA, and should always consult their paycheck to ensure that the proper taxes have been withheld.
Self-employed individuals, freelancers and independent contractors must pay FICA taxes before the yearly tax payment deadline set by the IRS, which falls on or around April 15th.
Every employed individual in the U.S. is required to pay FICA taxes on their income, regardless of whether they work for someone else or are self-employed.
FICA taxes support two different Social Security programs: Medicare's Hospital Insurance (HI) and the Old-Age, Survivors and Disability Insurance (OASDI).
Because employers and employees must both contribute, FICA is therefore more akin to a contribution program, despite technically being regarded as a tax.
Through FICA, the IRS gathers the money for the benefits program, which it then gives to the SSA to distribute to individuals approved to receive funds.
For 2011, the FICA tax rate was a total 12.4 percent of net earned income, with 6.2 being payable by the employee and 6.2 payable by the employer.
FICA stands for the Federal Insurance Contributions Act; this is the government's tax on income to support the national social security program.
This means that an individual earning more than $106,800 only pays 6.2 percent FICA taxes on $106,800, but not on any additional earnings.
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