FICA - Social Security & Medicare Taxes

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Additional Technical Notes on Social Security and Medicare Taxes

Starting with 2010, there have been several changes to how Social Security and Medicare taxes are computer for both the Employee and the Employer. In order to accommodate these changes these changes historically in the AccuBuild System, several new fields were used in the PRCHECKS historical file. The following recap explains each change and how where the information is stored in the PRCHECKS table.

2010 HIRE ACT – For qualified new hire employee, the wages paid between 3/19/2010 and 12/31/2010 were exempt for the employer to match the FICA 1 (Social Security Tax). For payroll checks that qualified during this period the following amounts were stored in the PRCHECKS file:

•	TaxAmount1 – Contained the FICA1 Tax Amount that was exempt for Employer Match

•	TaxAmount2 – Contained the FICA1 Subject To Wages that were exempt from Employer Match

2011 Tax Year – Beginning with the 2011 Payroll Calendar Year, the Employee Rate for FICA Dropped to 4.2% but the Employer Match remained at 6.2%. Therefore Employer matching amounts for FICA1 (Social Security) and FICA2 (Medicare) are now being stored in the batch and historical files:

•	TaxAmount3 – Contains the Employer portion of FICA1 (Social Security) tax for payroll tax burden.

•	TaxAmount4 – Contains the Employer portion of FICA2 (Medicare) tax payroll tax burden.

2013 Tax Year – Beginning with the 2013 Payroll Calendar Year, the new Additional Medicare tax kicks in for ObamaCare and is a tax that is withheld for the employee BUT is NOT Matched by the employer. These new amounts will be tracked in the following files of the batch and historical files:

•	SUBJ_FICA – Contains the employee wages above the $200K (for 2013) limit where wages are subject to an additional tax of 0.9% (.009 for 2013) which is added to the normal Medical Tax Amount.

•	TaxAmount5 – Contains the new Additional Medicare Tax Amount for payroll checks after 12/31/2012.

•	FICA2 – Will now contain both the Normal Medicare Tax + the Additional Medicare Tax

•	TaxAmount4 – which contains the Employer portion of FICA2 will now be adjusted so that the new Additional Medicare Tax is NOT Matched by the employer.