Final answer:
The claim that governments do not incur FICA tax expenditures and contributions to retirement plans is false. Government entities, like businesses, must contribute to Social Security and Medicare for their employees. Early retirement planning is essential, and government employees contribute to FICA as part of their retirement savings.
Step-by-step explanation:
The statement that governments do not incur expenditures/expenses for the employer's share of FICA taxes and for contributions to other retirement plans established by law is false. Like businesses, government entities are responsible for contributing to Social Security and Medicare, which are forms of retirement insurance. Employees working for the government also have a percentage of their income withheld for these programs. Unlike private sector firms, government agencies do not partake in a competitive market environment and primarily receive funding from tax dollars. However, government employment still operates under many of the same payroll tax requirements as private businesses, including contributions to federal retirement programs.
Additionally, it is worth noting that planning for retirement is important and starting early is beneficial. While you are already contributing to retirement savings through FICA taxes, it is often recommended to save additional funds to ensure a comfortable retirement. Government employees, like others, contribute to retirement savings plans such as FICA, and government employers also bear financial responsibilities similar to those in the private sector.