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19 August, 19:50

One possible solution to a diminishing Social Security payroll is to increase the Social Security tax by 1.89%. How would such an increase effect the tax on an annual salary of $54,000?

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  1. 19 August, 20:13
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    Annual tax increase by $1,020.60.

    Explanation:

    As the Social Security payroll is increases the Social Security tax, So, it will lead to increase the annual tax and it is computed as:

    Increase in Annual Tax = Salary * Increase in Social Security tax

    Where,

    Salary amounts to $54,000

    Increase in Social Security Tax by 1.89%

    Putting the values above:

    = $54,000 * 1.89%

    = $1,020.60
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