Hi everyone, I’m a part-time concessions worker at a non-profit theater, and I noticed something odd on my paystub. The amount taken out for Social Security is 12.4%, but I thought employees only pay 6.2% while employers match it for a total of 12.4%. Why am I being charged the full amount?
I’m new to all of this, so sorry if this is a silly question. Just trying to figure out if this is normal or if something’s wrong. Thanks in advance!
Are you sure you’re reading the paystub correctly? Sometimes paystubs show both the employee and employer contributions, but only your part should actually be deducted from your paycheck.
Harper said:
Are you sure you’re reading the paystub correctly? Sometimes paystubs show both the employee and employer contributions, but only your part should actually be deducted from your paycheck.
Not all paystubs include the employer’s contribution, but it could be a mistake. Are you sure it’s exactly 12.4%? Since you work in concessions, could it have something to do with tips?
@Uma
Some payroll systems do show both employee and employer contributions. For example, when I worked at a company using Gusto, my paystub listed both the taxes I paid and the employer’s part.
@Uma
It is exactly 12.4%. I do get tips, but they’re paid in cash after each shift. The paystub shows less than what I actually received in tips, though. Could that be why?
Ray said:
@Uma
It is exactly 12.4%. I do get tips, but they’re paid in cash after each shift. The paystub shows less than what I actually received in tips, though. Could that be why?
If the Medicare tax on your paystub is also doubled, it could mean they’re withholding for unreported tips. Employers sometimes allocate tips for tax purposes if employees don’t report them, which might explain the discrepancy.
@Uma
That makes sense. I’ll double-check the Medicare tax. It’s strange that my paystub doesn’t match my actual tips, though.
Harper said:
Are you sure you’re reading the paystub correctly? Sometimes paystubs show both the employee and employer contributions, but only your part should actually be deducted from your paycheck.
My pay rate is $15/hour, and I worked 12.75 hours. My gross pay was $192.91, and $24.24 was taken out for Social Security. If I’m calculating correctly, that’s 12.4%. Nothing on my paystub indicates any employer contribution.
Harper said:
@Ray
Do you earn tips? If so, those are also subject to Social Security tax.
Yes, I do. That might explain it.
@Ray
$192.91 x 12.4% = $23.92, not $24.24. Are you sure about the numbers? Can you share more details or a picture of the paystub?
https://www.ssa.gov/help/iClaim_nonCov1.html
https://www.ssa.gov/benefits/retirement/planner/religious.html
It’s possible there’s an exemption for certain non-profits, especially religious ones. This could explain why your employer isn’t contributing.
@Rayne
The exemption for non-profits hasn’t been widely available since 1984. It only applies to specific religious organizations that object to Social Security on religious grounds. It’s worth checking if your employer falls into that category.
Social Security and Medicare taxes together total 15.3%—7.65% each from the employee and employer. If you’re paying the full 12.4% for Social Security, something might be off.