Two percent cut to hit working Americans - KPLC 7 News, Lake Charles, Louisiana

Two percent cut to hit working Americans

Unwelcome news is hitting working Americans as they discover their pay is being cut by two percent.

It's a result of the end of a payroll tax holiday.

Your 2 percent pay loss is Social Security's gain.

To figure out how much it will cost you, multiply by two percent, .02, by your gross income.

Divide that by 12 to get your estimated monthly loss.

So, if you're making a $30,000 salary, expect $50 less a month. If you're making $60,000, $100 less a month and so on.

"Payroll tax holiday, that's going away … that's gone," said Mike Conway, Liberty Tax Service franchise owner.

Conway said the feds lowered the payroll tax rate in 2011 from 6.2 percent to 4.2 percent to allow people to keep more cash in their pockets.

"It was when our economy went to pot two years ago and they tried to come up with ways to stimulate the economy," Conway said.

But now that the economy is recovering and the fiscal cliff is averted, Uncle Sam will get back to collecting.

"A two percent increase in the Social Security and Medicare tax," Conway said.

Wells Fargo's Teresa Morris said to further cushion the blow, craft a budget with streamlined expenses for fuel, utilities, eating out and entertainment.

"We would encourage them to go in and speak to their personal banker and really come up with a plan that works best for them and their family," Morris said.

Another change is for Social Security and federal benefits recipients.

Starting March 1, paper checks will no longer be issued.

You must sign up for direct deposit or a Direct Express Debit Mastercard.

If these steps aren't taken, be ready for an interruption in the payment.

If you need help switching to electronic payments, call the Treasury's Go Direct Line at 1-800-333-1795.

For those of you just learning of the overall 2 percent cut in pay, money experts recommend that you make immediate spending adjustments to your budget.

KPLC's Britney Glaser will have more on this at 6 p.m.

Copyright 2013 KPLC. All rights reserved. WMC-TV, in Memphis, also contributed to this article.

  • More Local NewsNewsMore>>

  • Catching up with former KPLC senior reporter Flora Roberts

    Friday, May 25 2018 11:21 PM EDT2018-05-26 03:21:37 GMT
    (Source: Maranda Whittington/KPLC)(Source: Maranda Whittington/KPLC)
    (Source: Maranda Whittington/KPLC)(Source: Maranda Whittington/KPLC)
    For 16 year viewers learned the ins and outs of seniors here in Southwest Louisiana thanks to our stations very own senior reporters.  A few weeks ago, we caught up with one of them, but where are the rest?  7News  found Flora Roberts, and discovered just what's keeping her busy these days.  "They always tell me they recognize the voice," said Roberts. The voice behind the stories of Southwest Louisiana seniors belonged to that of Flora Roberts.&...More >>
    For 16 year viewers learned the ins and outs of seniors here in Southwest Louisiana thanks to our stations very own senior reporters.  A few weeks ago, we caught up with one of them, but where are the rest?  7News  found Flora Roberts, and discovered just what's keeping her busy these days.  "They always tell me they recognize the voice," said Roberts. The voice behind the stories of Southwest Louisiana seniors belonged to that of Flora Roberts.&...More >>
  • Time capsule buried to mark end of Lake Charles Sesquicentennial Celebration

    Time capsule buried to mark end of Lake Charles Sesquicentennial Celebration

    Friday, May 25 2018 10:55 PM EDT2018-05-26 02:55:05 GMT
    (Source: KPLC)(Source: KPLC)
    (Source: KPLC)(Source: KPLC)
    The city buried a time capsule at the final event of the year-long Sesquicentennial Celebration in Lake Charles. A time capsule was buried on the grounds of 1911 Historic City Hall. The items buried include letters from various officials, a video message and highlight video, a McNeese football mini-helmet, and several books on the city's history. The capsule is slated for opening at the city's bicentennial celebration in 2067.  The burial of the time capsule official...More >>
    The city buried a time capsule at the final event of the year-long Sesquicentennial Celebration in Lake Charles. A time capsule was buried on the grounds of 1911 Historic City Hall. The items buried include letters from various officials, a video message and highlight video, a McNeese football mini-helmet, and several books on the city's history. The capsule is slated for opening at the city's bicentennial celebration in 2067.  The burial of the time capsule official...More >>
  • Send us your Memorial Day pictures

    Send us your Memorial Day pictures

    Friday, May 25 2018 9:41 PM EDT2018-05-26 01:41:00 GMT
    (Source History.com)(Source History.com)

    Memorial Day is Monday, May 28.

    Send us a picture of the veteran you wish to honor and we'll feature it on our website.

    More >>

    Memorial Day is Monday, May 28.

    Send us a picture of the veteran you wish to honor and we'll feature it on our website.

    More >>
Powered by Frankly