Payroll taxes

The video explains payroll taxes, created to fund Social Security and Medicare. Both employers and employees contribute 7.65% of wages, with specific caps for Social Security and Medicare. Certain groups, like ministers and students, are exempt. Self-employed individuals pay both employer and employee portions as self-employment taxes.

What are the two main government programs funded by payroll taxes?

• Unemployment Insurance and Medicare

• Medicare and Medicaid

• Social Security and Medicare

• Social Security and Medicaid

What percentage of an employee's wages is withheld for payroll taxes in 2023?

• 8.5%

• 1.45%

• 7.65%

• 6.2%

What is the cap on the salary amount subject to Social Security taxes in 2023?

• $180,000

• $160,200

• $250,000

• $200,000

What is the additional percentage applied to wages above $200,000 for Medicare?

• 1.2%

• 0.9%

• 0.5%

• 1.5%

Which group is generally exempt from FICA taxes?

• Part-time workers

• Retired individuals

• Self-employed individuals

• Ministers and church employees

What type of tax are self-employed individuals subject to?

• Payroll taxes

• Income taxes

• Self-employment taxes

• Capital gains taxes

Which of the following is NOT a group exempt from FICA taxes?

• Members of certain religious groups

• Minors in family businesses

• Full-time employees

• Foreign students on certain visas