MENU
component-ddb-728x90-v1-01-desktop

Taxpayers react to first paychecks without 2% payroll tax cut

NORTH CHARLESTON, S.C. (WCIV){}-- Effective Jan. 1, the 2009 payroll tax cut expired. Depending on pay cycle, some taxpayers may have already noticed a two percent decrease in their paycheck.

"It just seems like every time we turn around, we're getting taxed for something," said Nathan Sullivan, a business owner for 40 years.

For the average $30,000 salary, two percent is about $50 a month, or about $12 a week.

"That's a tank of gas," said Sean Highsmith. "That's half of my retirement income, so if I wasn't paying that, I could be paying that to my retirement.

Highsmith owns a custom cabinet and countertop business and has about nine employees. He said he worries how the payroll increase will affect his workers.

"I don't make a lot but, they make a lot less than I do. And in their cases some of them are just barely getting by," he said.{}

Bill Prewitt, a financial advisor with Charleston Financial advisors says he hasn't heard any concerns from his clients, but the $50 cut could hurt a working-class family.

"That's a lot of money, compared to people who don't got money," said Donald McFadden.

The payroll tax increased from 4.2 percent to 6.2 percent. The lower rate{}was costing the federal{}government $120 billion in tax revenue{}per year.

The increase will go into Social Security but, for folks like Highsmith, "If it's not guaranteed to me, then it's kind of like me investing in birth control: I don't need it."

Trending