Tuesday, February 14, 2012

Payroll Tax Cut: Good for Americans?

When the payroll tax cut was introduced, everyone felt that it was a wonderful thing. The average American got $40 back in pockets per paycheck. However, Americans did not read the fine print.

The payroll tax cut is funded by money that would have gone to Social Security. In 2011, $105 billion was taken away from the coffers of Social Security. By continuing the tax cut, an additional $119 billion will be siphoned away from Social Security.

With Social Security already having problems meeting its obligation to retirees, where will the money come from?  How will the shortfall be addressed?

As the old adage goes, "The large print giveth and the fine print taketh away."

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