| What are significant changes to the payroll tax withholding rules for 2011?
Per the IRS, for 2011, the employee tax rate for social security is 4.2%, but the employer tax rate for social security remains unchanged at 6.2%. Thus, Congress did not provide any employer relief! The 2011 social security wage base limit is $106,800.
In 2011, the Medicare tax rate is 1.45% each for employers and employees, unchanged from 2010. Unfortunately, there is no wage base limit for Medicare tax.
The IRS has requested that all "Employers should implement the 4.2% employee social security tax rate as soon as possible, but not later than January 31, 2011." After implementing the new 4.2% Daily or Miscellaneous 14.23 rate, employers should make an offsetting adjustment in (each day of the payroll period) a subsequent pay period to correct any overwithholding of social security tax as soon as possible, but not later than March 31, 2011.
| 
Linear Mode
