Taxes go up in 2013 for 163 million workers

Come January, 163 million workers can expect to feel the pinch of a big tax increase regardless of who wins the election.

A temporary reduction in Social Security payroll taxes is due to expire at the end of the year and hardly anyone in Washington is pushing to extend it. Neither President Obama nor Presidential candidate Romney has proposed an extension, and it probably wouldn't get through Congress anyway, with lawmakers in both parties down on the idea.

This will cost a typical worker about $1,000 a year, and two-earner family with six-figure incomes as much as $4,500.

Social Security is funded by a 12.4 percent tax on wages up to $110,100, rising to $113,700 in 2013. Half is paid by employers and the other half is paid by workers. For 2011 and 2012, Congress and Obama cut the share paid by workers from 6.2 percent to 4.2 percent.

A worker making $50,000 saved $1,000 a year, or a little more than $19 a week. A worker making $100,000 saved $2,000 a year.

Source:  Associated Press

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