How difficult is it going to be to let the payroll taxes expire?

[kentuck]

Those making about $35K per year will lose about $700 dollars and those making $110K will lose about $1800 per year. Will that be a tough political decision? Did you think it would be easier when it passed?

Or perhaps you think we should keep the payroll taxes in place also?

[Demobrat]

1. That payroll tax cut was meant to be temporary

Leaving it in place would threaten social security. We should let it expire as it was meant to.

[kentuck]

2. So were the Bush taxcuts.

But they don't seem so easy to let expire, do they?

[unblock]

5. the shrub cut proponents ALWAYS intended for them to be permanent

they only put in the sunset provision after the numbers were too horrendous for democrats to swallow. and they started laying the political groundwork for extension immediately after passage.

the payroll tax cuts, on the other hand, were always intended to be temporary, and there hasn't ever been a motivated political bloc pushing to make them permanent.

[BeyondGeography]

3. That one is done

I was surprised it didn't come up during the campaign, because Obama would have had been forced to admit he had no intention of continuing that cut (nor did Romney). That's one thing both parties actually agree on.

[democrattotheend]

4. Do we want them to expire?

62% of Americans pay more in payroll tax than they do in income tax. Ideally, they would keep the payroll tax rate lower and compensate by raising the cap to subject a greater portion of higher incomes to the tax.

[unblock]

6. i wonder if this is even being discussed as part of the "fiscal cliff" negotiations

[B2G]

7. HR systems are going to need to be modified

They'd better decide soon. Like last month.

[kentuck]

9. Yeah, employers made profits hand over fist...

But no one thought of asking them to give their workers a couple of percent pay raise and the payroll tax would never have been needed in the first place. Many did not give their employees a raise for two or three years. They could well have afforded it. Someone could have at least made the suggestion, rather than cutting the SS contributions.

[B2G]

10. And no ones cares if those same workers have to work OT over the holidays

to implement last minute system changes. Makes me sick. Fedco couldn't care less.

[Old Codger]

8. It is necessary

Really the need to expire, all of that stuff needs to be allowed to go away in order for anything meaningful to be accomplished in tax reform.. as long as all the attention is focused on the fight over these "temporary" programs nothing permanent will happen. They will just keep kicking the can down the road.

[ChazII]

12. +1 n/t

[bluestate10]

11. The Payroll Tax rate should be set at 4 or 5% permanently and the Cap should be eliminated.

A single person making $35K per year never hit the cap, that person pays for the full year. A single person making $110K per year does hit the cap and go SS tax free for several weeks toward the end of the year. Single people earning more than $110K per year hit the cap earlier and earlier, depending upon how much each person earn. Very high earners cap out literally days into each year.

Permanent reduction of the rate to 4-5% from 6% would give low earners more money in their pockets for good, while elimination of the cap would offset or even wipe out the impact of the lower rate on the SS Trust Fund.