COLUMBUS, Miss. (WCBI)–After plenty of hand wringing and even some holiday work, Congress was finally able to avoid sending us over the fiscal cliff, but before you break out the bubbly, there is something else to consider.
Your first check of the new year, might be a little less than you’re used to.
The problem with tax breaks is people have a way of getting used to them.
For the past couple of years, you’ve gotten to take home a little more of your pay.
Elaine Evans is a certified public accountant in Columbus.
She breaks it down for us, “Last year, employees paid 4.2% in Social Security which was a roll back from the government to give a tax break to stimulate the economy.”
And it worked, not greatly, but well enough, that it’s over now.
Elaine continues, “So what’s happening this year, is the government has said, ‘ We need that revenue. We are going back to what it was originally.’ Which was 6.2 percent.”
Doesn’t sound like much, but it really adds up over the course of the year.
Trey Burnside, is a personal trainer at the Fitness Factor in Columbus.
Normal working guys like Trey are going to feel this.
He says, “It’s going to hurt me in the long run, I guess, because it’s going to be less spending and household living expenses.”
Say you make $50,000 a year.
You’ll pay roughly $1,000 dollars more this year in payroll taxes.
Elaine adds, “The lower the income, the harder it hits. It will be less money to take home. Less money in the economy to spend, but more revenue hitting Uncle Sam’s pocketbook.”
It’s an issue Trey would have liked to hear more about in the year end news cycle.
Trey says, “I wish I would. I probably would have been more prepared in saving my money.”
So will things ever go back to the way they were in the sunny days of 2012?
Elaine laments, “It’s not going to happened this year. It would have to be in the future. If we did fall off the cliff and see some dire economic down turn there is a possibility, but I don’t see it happening. It’s not going to happen this year.”
Another reason to watch those pennies.
You will see the increased tax on any money you’ve earned in 2013.
So make sure to take a good look at your paycheck.