Paychecks to get smaller for Americans after tax cut expires - 13abc.com Toledo (OH) News, Weather and Sports

Paychecks to get smaller after tax cut expires

Posted: Updated:

The nation may not have gone over the fiscal cliff, but the new deal will have millions of American workers seeing smaller paychecks.

"It could be much worse," Ron Gould, a certified financial planner, told 13abc.  "I think its going to surprise people."

In 2011, the President and Congress, put a payroll tax cut in place.  It lowered it to 4.2% down from 6.2%.  The idea was to give Americans some extra cash each paycheck to help boost the economy.  However, the tax cut expired Monday, meaning workers are shelling out more in payroll taxes, money that funds Social Security.

"So now, we're going to start paying again, but we still have to make up that one year of 2% less," Gould said.

Here is what that means for you.  If you make $50,000 a year, you'll pay an extra $1,000 in payroll taxes this year.

The bigger the paycheck, the bigger the amount.  People making $100,000 a year will pay and extra $2,000.

"When they get that first check and if you're in a position where you get paid the same, all of a sudden there's a chunk missing," Gould said.  "You're going to realize that."

Gould says the increase will also be felt economically, however, he insists it won't be drastic.

He also says if people have concerns about the fiscal cliff deal, they should look into talking with a certified financial planner.  Click here to find one in your area.

  • LocalMore>>

  • Christian music fest rocks West Toledo

    Christian music fest rocks West Toledo

    Sunday, July 27 2014 11:20 PM EDT2014-07-28 03:20:10 GMT
    Christian music filled the air in West Toledo Sunday at the annual Exclaim music festival at the Monsignor Schmit CYO Athletic Complex.
    Christian music filled the air in West Toledo Sunday at the annual Exclaim music festival at the Monsignor Schmit CYO Athletic Complex.
  • City has new weapons in the war on sinkholes

    City has new weapons in the war on sinkholes

    Sunday, July 27 2014 11:08 PM EDT2014-07-28 03:08:13 GMT
    Toledo has some new weapons in the war against sinkholes and that new technology could save a lot of time and money.
    Toledo has some new weapons in the war against sinkholes and that new technology could save a lot of time and money.
  • Art on the Mall puts spotlight on UT

    Art on the Mall puts spotlight on UT

    Sunday, July 27 2014 6:37 PM EDT2014-07-27 22:37:55 GMT
     The threat of severe weather didn't keep visitors away from Art on the Mall at the University of Toledo on Sunday.
     The threat of severe weather didn't keep visitors away from Art on the Mall at the University of Toledo on Sunday.
  • Top StoriesMore>>

  • City has new weapons in the war on sinkholes

    City has new weapons in the war on sinkholes

    Sunday, July 27 2014 11:08 PM EDT2014-07-28 03:08:13 GMT
    Toledo has some new weapons in the war against sinkholes and that new technology could save a lot of time and money.
    Toledo has some new weapons in the war against sinkholes and that new technology could save a lot of time and money.
  • Neighbors shocked by "preventable" drowning

    Neighbors shocked by "preventable" drowning

    Sunday, July 27 2014 6:19 PM EDT2014-07-27 22:19:43 GMT
     Neighbors in Erie Township were shocked to hear about the drowning death of 34-year-old Jason Mitchell of Perrysburg. He drowned Saturday evening after falling off a jet ski in a private lake on Sterns Road.
     Neighbors in Erie Township were shocked to hear about the drowning death of 34-year-old Jason Mitchell of Perrysburg. He drowned Saturday evening after falling off a jet ski in a private lake on Sterns Road.
  • Small plane crashes in Hancock Co., 2 dead

    Small plane crashes in Hancock Co., 2 dead

    Sunday, July 27 2014 4:48 PM EDT2014-07-27 20:48:48 GMT
     Two people were killed in an early morning small plane crash near Findlay on Sunday.
     Two people were killed in an early morning small plane crash near Findlay on Sunday.

Area Events Calendar

See It, Shoot It, Send It!