Question

Also suppose that the taxes for Social Security and Medicare together are 7.65%, and that they are applied to income up to $100,000. If your income is $123,000, what is your total income tax bill and how much will you have paid in Social Security and Medicare taxes? Total income tax: $ Social Security and Medicare taxes: $

Answer 1

Social security: 6200, Medicare: 1783.50 total: 7983.50

Step-by-step explanation:

The cap is on the FICA/social security portion only, not the Medicare portion so

100,000 x .062=6200 social security tax

123000x .0145=1783.50 Medicare tax

total taxes=7983.50

Answer 2

The taxable income is 100,000 dollars

the taxes amount to 7,650 dollars

Step-by-step explanation:

As our income are above the celling (123,000 dollars) we pay taxes up to 100,000 which is where the taxable income is capped at.

taxable income x tax rate = taxes payable

100,000 dollars' x 7.65% taxes = 7,650 dollars of taxes in social security and madicare.