This notice is in regards to the Social Security (OASDI) tax
deducted from the January 3, 2012 paychecks.
In 2010, President Obama signed into law the Tax Relief
Unemployment Insurance Reauthorization, and Job Creation Act of 2010. Included in the Act was a provision that
reduced the Social Security withholding rate from 6.2% to 4.2% for 2011. This change was effective with wages paid on
or after January 1, 2011 and included an expiration date of December 31,
2011. In order to comply with the
expiration date of December 31, 2011 and to insure that December earnings were
paid in a timely manner, the Social Security tax rate was changed back to 6.2%
in time for the pay compute of the January 3, 2012 paychecks.
On December 23, 2011, President Obama signed the Temporary
Payroll Tax Cut Continuation Act of 2011 to extend the 2% reduction in Social
Security (OASDI) tax withholding on wages paid after January 1, 2012. Since this change was not enacted in time to
affect the 1/3/2012 pay checks, monthly employees paid on January 3, 2012 were
subject to Social Security withholding tax at the old rate (6.2%). A refund for the difference has been automatically
processed and will be reflected on the February 1, 2012 paychecks.
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