1. Question: Use the following tax rates, ceiling and maximum taxes:
Employee and Employer OASDI: 6.20% $132,900 $8,239.80
Employee* and Employer HI: 1.45% No limit No maximum
Self-employed OASDI: 12.4% $132,900 $16,479.60
Self-employed HI: 2.9% No limit No maximum
*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.
Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows:
Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the overtime rate).
If the third decimal place is 5 or more, round to the next higher cent.
If the third decimal place is less than 5, drop the third decimal place.
Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.
Beginning with the first pay of the year, Carson will make $2,700 each week. In which numbered pay of the year will Carson hit the OASDI taxable limit?
1 Answers Choices: 46th pay, 47th pay, 48th pay, or 50th pay.

2 Question:

Use the following tax rates, ceiling and maximum taxes:

Employee and Employer OASDI: 6.20% $132,900 $8,239.80

Employee* and Employer HI: 1.45% No limit No maximum

Self-employed OASDI: 12.4% $132,900 $16,479.60

Self-employed HI: 2.9% No limit No maximum

*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.

Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows:

Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the overtime rate).

If the third decimal place is 5 or more, round to the next higher cent.

If the third decimal place is less than 5, drop the third decimal place.

Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.

In this pay, Moss Company deducted OASDI taxes of $5,276.24 and HI taxes of $1,233.95 from the $85,100.90 of taxable wages paid. What is Moss Company's portion of the social security taxes for:

What's the HI tax?