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>>

  • Lake Charles opens time capsule buried 50 years ago

    Saturday, May 27 2017 9:24 AM EDT2017-05-27 13:24:56 GMT
    (Source: Maranda Whittington/KPLC)(Source: Maranda Whittington/KPLC)

    On Friday Mayor Randy Roach helped pull out history - 50 years worth, to be exact.

    In 1967 a time capsule was buried in front of historic Lake Charles City Hall, and many had different ideas of what could be buried inside. 

    More >>

    On Friday Mayor Randy Roach helped pull out history - 50 years worth, to be exact.

    In 1967 a time capsule was buried in front of historic Lake Charles City Hall, and many had different ideas of what could be buried inside. 

    More >>
  • Summer reading fun underway in Calcasieu Parish

    Summer reading fun underway in Calcasieu Parish

    Friday, May 26 2017 11:02 PM EDT2017-05-27 03:02:13 GMT
    (Source: Calcasieu Parish Public Library)(Source: Calcasieu Parish Public Library)

    The Calcasieu Parish Public Library annual summer reading program is underway. The kick-off celebration was held at Prien Lake Park. It included registration, face painting, kite flying, bird house building and even Clifford the Big Red Dog. The reading program runs from now until July 7.

    More >>

    The Calcasieu Parish Public Library annual summer reading program is underway. The kick-off celebration was held at Prien Lake Park. It included registration, face painting, kite flying, bird house building and even Clifford the Big Red Dog. The reading program runs from now until July 7.

    More >>
  • Parents of Gage Meche suing man they blame for gun being brought to school

    Parents of Gage Meche suing man they blame for gun being brought to school

    Friday, May 26 2017 10:18 PM EDT2017-05-27 02:18:02 GMT
    Gage Meche (Source: Facebook)Gage Meche (Source: Facebook)

    Gage Meche has thousands of people rooting for him and a family spokesman says it means a lot.  But attorney Ron Richard says the child's parents want action against the man they believe is responsible, they're suing Michael Lane Dugas.. “They are on a roller coaster of emotions:  anger, sadness, fear, angst and wanting to feel like they're doing something about this matter. 

    More >>

    Gage Meche has thousands of people rooting for him and a family spokesman says it means a lot.  But attorney Ron Richard says the child's parents want action against the man they believe is responsible, they're suing Michael Lane Dugas.. “They are on a roller coaster of emotions:  anger, sadness, fear, angst and wanting to feel like they're doing something about this matter. 

    More >>
Powered by Frankly