Social Security Tax Reduction Starts January 1, 2011.

Your employees will start taking home more pay with their first paycheck of 2011 thanks to the Tax Relief Act of 2010.  For 2011 only, the employee portion of social security tax will be reduced by 2% to 4.2%.  This could add up to a tax savings of up to $2136 per worker. Employers will still pay a rate of 6.2% of their employee earnings.

Make sure your payroll system can handle the new rates before you run the first payroll of 2011.  If not, you’ll have to retroactively apply the rates and refund the difference.

The law also provides for an extension of the current income tax rates for two years.

Our all new Point and Click payroll system automatically updates with tax law changes.