2 percent tax hike has workers finding less in their paychecks - New York News

2 percent tax hike has workers finding less in their paychecks

Posted: Updated:

By Robin Schwartz & Murray Feldman
Fox 2 News


ROYAL OAK, Mich. (WJBK) -- "I found out my check was about $20 bucks shorter than it usually is," said forklift driver Donnovan Kennedy.

Welcome to 2013.  An estimated 160 million workers found less in their paychecks Friday, and it will stay that way thanks to one federal tax that's back in full force.

"The payroll tax's that's always been there.  It's been 6.2 percent and it goes into Social Security and Medicare.  It's what you see on your paycheck as FICA," said LJPR Chief Investment Officer Brad Reynolds.

Two years ago, that tax was cut by two percent, but the so-called holiday has now expired.  Lawmakers let it happen when they worked out the fiscal cliff deal.

"In a sense they did raise taxes on the middle class, even though it's only two percent," Reynolds said.  "Who do you blame?  Blame government, I mean honestly both sides.  They came to the agreement."

Economists estimate this two percent tax hike could strip $115 million in disposable income from the economy this year, and that could hurt small businesses as people shop less.

"Go to work everyday, work hard.  I need all the money I can get," said Kennedy.  "There's always stuff you can cut back on.  I just have to decide what I want to cut back on."

Workers who make $20,000 to $30,000 a year will take home about $300 less this year.  Those who make $100,000 will fell a $2,000 tax crunch.

"You know, $10, $5 here after a year it adds up.  It could be somebody's rent, somebody's car payment, somebody's insurance, something to help the kids.  It's just not right," said Lauren Greenfield.

She works at a local restaurant and said every dollar counts in her budget.  The new, smaller paychecks will have many families rethinking their spending to start the year.

So how can you save $20 a week or more depending on your income?

Experts say you need a budget.  Carry a pencil and paper with you for a week and jot down everything you spend.  You'll probably be surprised.  Then create a budget.

If you buy lunch everyday, brown bag it.  You'll save up to $15 a week.

Call your cable company and ask for a better deal.  They may have one.

You can also sell some of the gift cards that are laying around the house.  The website GiftCardGranny.com may be helpful.

  • Local NewsLocal NewsMore>>

  • Record stores survive and thrive in Brooklyn

    Record stores survive and thrive in Brooklyn

    Friday, April 18 2014 10:59 PM EDT2014-04-19 02:59:51 GMT
    When you hear about a place that still sells records, located in a hip neighborhood in the borough of Brooklyn, you enter that store with certain expectations. One of them being: you hope the guy behind the counter talks about music the way Cory Fierman does."I think it's just like the most important thing to you," he says. "I don't know how to describe it. It's the most important thing to me. It's like another language."Cory manages Greenpoint's Academy Records Annex, where they want you ...
    When you hear about a place that still sells records, located in a hip neighborhood in the borough of Brooklyn, you enter that store with certain expectations. One of them being: you hope the guy behind the counter talks about music the way Cory Fierman does."I think it's just like the most important thing to you," he says. "I don't know how to describe it. It's the most important thing to me. It's like another language."Cory manages Greenpoint's Academy Records Annex, where they want you ...
  • Queens Beer Week kicks off

    Queens Beer Week kicks off

    Friday, April 18 2014 10:19 PM EDT2014-04-19 02:19:20 GMT
    Queens wants to be known as New York City's beer capital. Queens Beer Week kicked off on Friday to celebrate the borough's crafty breweries and the more than 60 venues that serve their beer. Dan Bronson of Crescent and Vine in Astoria is the bearded brains behind the inaugural Queens Beer Week. He organized it all. The nine-day celebration of beers brewed in Queens.
    Queens wants to be known as New York City's beer capital. Queens Beer Week kicked off on Friday to celebrate the borough's crafty breweries and the more than 60 venues that serve their beer. Dan Bronson of Crescent and Vine in Astoria is the bearded brains behind the inaugural Queens Beer Week. He organized it all. The nine-day celebration of beers brewed in Queens.
  • Woman wanted for baby snatch attempt in custody

    Woman wanted for baby snatch attempt in custody

    Friday, April 18 2014 9:57 PM EDT2014-04-19 01:57:17 GMT
    Police have taken into custody the woman believed to have tried to push a stroller with a baby inside away from a nanny in Chelsea. Tara Anne McDonald, 46, was being evaluated at a hospital Friday night. The attempted kidnapping occurred on 8th Ave. and 17th St. at about 3:45 p.m. on Thursday, police said.
    Police have taken into custody the woman believed to have tried to push a stroller with a baby inside away from a nanny in Chelsea. Tara Anne McDonald, 46, was being evaluated at a hospital Friday night. The attempted kidnapping occurred on 8th Ave. and 17th St. at about 3:45 p.m. on Thursday, police said.
Powered by WorldNow
Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | Terms of Service | Ad Choices