What is the employer's yearly contribution to the U.S. Social Security tax on a salary of [tex][tex]$\$[/tex]42,000[tex]$[/tex]?

\begin{tabular}{|c|c|c|}
\hline \multicolumn{3}{|c|}{ FICA Taxes } \\
\hline & Social Security & Medicare \\
\hline Total Due: & [tex]$[/tex]12.40\%[tex]$[/tex] & [tex]$[/tex]2.90\%[tex]$[/tex] \\
\hline \begin{tabular}{l}
Employer's \\
Responsibility
\end{tabular} & [tex]$[/tex]6.20\%[tex]$[/tex] & [tex]$[/tex]1.45\%[tex]$[/tex] \\
\hline \begin{tabular}{l}
Employee's \\
Responsibility
\end{tabular} & [tex]$[/tex]6.20\%[tex]$[/tex] & [tex]$[/tex]1.45\%[tex]$[/tex] \\
\hline
\end{tabular}

[tex]\$[/tex][?]$



Answer :

To determine the employer's yearly contribution to the U.S. Social Security tax on a salary of [tex]$42,000, we follow these steps: 1. Identify the relevant Social Security tax rate for the employer: According to the provided FICA tax table: - The Social Security tax rate for the employer is 6.20%. 2. Determine the annual salary: - The annual salary in this case is $[/tex]42,000.

3. Calculate the employer's contribution:
- To find the employer's contribution, we need to multiply the annual salary by the Social Security tax rate.
- The tax rate must be converted from a percentage to a decimal for multiplication. So, 6.20% becomes 0.062.

So, the calculation is:
[tex]\[ \text{Employer's Social Security contribution} = \text{Annual Salary} \times \text{Social Security Rate} \][/tex]
[tex]\[ \text{Employer's Social Security contribution} = 42,000 \times 0.062 \][/tex]

By performing this multiplication, we find:
[tex]\[ \text{Employer's Social Security contribution} = 2,604.00 \][/tex]

Therefore, the employer's yearly contribution to the U.S. Social Security tax on a salary of [tex]$42,000 is $[/tex]2,604.00.