Karen Cooper,the founder of SmartIT Staffing,realized that effectively managing payroll was crucial to the success of her business.If an employee of the company earns $50,500 per year,SmartIT Staffing's total FICA payroll tax for this employee is:
A)$3,863.25.
B)$3,131.00.
C)$732.25.
D)$3,535.
E)Zero because the employee has not earned more that the FICA earnings limitation.

Question

Quizplus · Accepted Answer

The FICA tax rate is 7.65% (6.2% for Social Security and 1.45% for Medicare). For an annual salary of $50,500, the FICA tax is $50,500 * 7.65% = $3,863.25.

Karen Cooper,the Founder of SmartIT Staffing,realized That Effectively Managing Payroll