A break for workers
Most American workers saw a bump in their paychecks at the start of this year thanks to a bill that gives them a yearlong discount on their payroll tax in 2011. Most workers typically pay 6.2% of their salaries, or up to $106,800, toward Social Security. But the new legislation, part of a larger tax cut package, will reduce that to 4.2%.
With more cash to take home, the Obama administration hopes the savings will encourage workers to spend more and help keep the economy chugging along. It might be too early to say how the tax break is performing but some already expect --given the rise in food and gas prices so far -- it might not do much to boost real spending.
The tax holiday is scheduled to expire next year.
NEXT: A break for small business owners
Last updated March 10 2011: 12:45 PM ET
