It’s that time of year again! When certain people who make six-figure salaries realize that they are getting to keep more of their salary for the rest of the year because they’ve maxed out the amount they are expected to pay into Social Security. In the case of my friend who acquainted me with this phenomenon, and who was super excited about it, it’s an extra $200 per pay period, but YMMV.
From the SSA website:
When you have wages or self-employment income that is covered by Social Security, you pay Social Security taxes each year up to a maximum amount that is set by law. That amount has changed frequently over the years. For 2013, the maximum amount of taxable earnings was $113,700. In 2014, the maximum amount of taxable earnings is $117,000.
Clear? No? How about now: