Question

Mr. Connelly had two jobs in 2014. The first job, in which he earned $82,700, was fromJanuary to September, and then the second job he $52,700. Since both employers deductedSocial Security tax, did he overpay? If so, how much should he be refunded? (In 2014, theSocial Security tax was 6.3% with a maximum taxable income of $114,400.)

Answer 1

First determine did he meet the maximum taxable income

82700 + 52700 = 135400

He was over the max

He shuld onlly pay on the max amount

114400 * .063 = 7207.20

He paid on 135400

135400 * .063 =8530.20

Taki the amount he paid and subtract the max he should pay to determine the amount he overpaid

8530.20-7207.2 =1323.00

He overpaid 1323.00

He should be refunded 1323.00