Social Security tax rate to revert to 6.2 percent in January
UC employees will have a little slimmer paycheck come January 2013 as the two-year Temporary Payroll Tax Cut comes to an end.
That tax cut temporarily reduced the Social Security withholding rate from 6.2 percent to 4.2 percent. The withholding rate is currently scheduled to return to 6.2 percent effective Jan. 1, 2013. The taxable wage base will also increase to $113,700 from $110,100.
In addition, employees earning $200,000 or more will see a 0.9 percent increase in their Medicare withholding, to 2.35 percent from 1.45 percent. This provision of the Affordable Care Act is effective Jan. 1, 2013.
For most University of California campuses, the new withholding rates will become effective with the first pay date on or after Jan. 2, 2013.