Mike samson is a college football coach making a base salary of $632,400 a year ($52,700 per month). employers are required to withhold a 6.2% social security tax up to a maximum base amount and a 1.45% medicare tax with no maximum.
assume mike was employed throughout the year and the fica base amount is $113,700.

1. compute how much will be withheld during the year for coach samson? s social security and medicare. what will the amount of social security be and how will i find it?

2. what additional amount will the employer need to contribute towards fica taxes? what will be the additional amount and how will i find that ?

Part 1:

Total amount withheld for Social Security and medicare=$16264.2

Amount withheld for Social Security=$7049.4

Part 2:

Additional amount which the employer will contribute=$16264.2

Explanation:

Part 1:

Amount withheld for Social Security= $113700 * 6.2%=$113700 * 6.2/100

Amount withheld for Social Security=$7049.4

Amount withheld for Medicare=$632400 * 1.45%=$632400 * 1.45/100

Amount withheld for Medicare=$9169.8

Total amount withheld for Social Security and medicare=$7049.4+$9169.8

Total amount withheld for Social Security and medicare=$16264.2

Part 2:

The additional amount which the employer will contribute towards the FICA taxes is same as withheld by Coach Samson.

Additional amount which the employer will contribute=$7049.4+$9169.8

Additional amount which the employer will contribute=$16264.2

one of the appeals of a sole proprietorship is that business expenses are kept separate from your personal income tax return