George is a full-time exempt employee in Bismarck, North Dakota. He earns an annual salary of $39,750 and is paid semimonthly. He is married filing separately and has indicated checkbox withholding on his 2021 Form W-4, with an additional withholding of $45.00. His state income tax is 2.04%, and Bismarck local income tax is 7.0%. What is the total of FICA, federal, state, and local tax deductions per pay period, assuming no pre-tax Deductions? (Use the wage-bracket table to determine federal taxes.
To calculate the total tax deductions per pay period, we need to calculate each tax separately and then add them up.
First, let's calculate FICA (Federal Insurance Contributions Act) taxes. FICA consists of two parts: Social Security tax and Medicare tax.
1. Social Security tax: The current Social Security tax rate is 6.2%. Since George is a full-time exempt employee, we'll assume his wages are subject to the full 6.2% rate.
- Annual Social Security tax = $39,750 * 6.2% = $2,464.50
- Social Security tax per pay period = $2,464.50 / 24 (semimonthly pay periods) = $102.69
2. Medicare tax: The current Medicare tax rate is 1.45%, and there's no income cap.
- Annual Medicare tax = $39,750 * 1.45% = $576.38
- Medicare tax per pay period = $576.38 / 24 = $24.01
Next, let's calculate federal income tax using the wage-bracket table. Since George is married filing separately, we'll use the table for single individuals.
Based on the wage-bracket table for 2021, the federal income tax for an annual salary of $39,750 ranges from $4,800 to $5,699. We'll use the upper limit value.
- Federal income tax per pay period = $5,699 / 24 = $237.46
Now, let's calculate state income tax and local income tax.
3. State income tax: George's annual salary is $39,750, and the state income tax rate is 2.04%.
- Annual state income tax = $39,750 * 2.04% = $812.10
- State income tax per pay period = $812.10 / 24 = $33.84
4. Local income tax: The Bismarck local income tax rate is 7.0%.
- Annual local income tax = $39,750 * 7.0% = $2,782.50
- Local income tax per pay period = $2,782.50 / 24 = $115.94
Finally, let's calculate the total tax deductions per pay period.
Total tax deductions per pay period = FICA + federal income tax + state income tax + local income tax
Total tax deductions per pay period = $102.69 + $24.01 + $237.46 + $33.84 + $115.94
Total tax deductions per pay period = $513.94
Therefore, the total FICA, federal, state, and local tax deductions per pay period for George is $513.94.