Paying Social Security Tax When Switching Jobs

Check the details of your pay stub carefully.

The levy that funds the Social Security system is a payroll tax. When you work for an employer, that employer withholds a set percentage of your income and sends it to the government. Withholding the proper amount of Social Security taxes is the responsibility of your employer, but you should still verify that the withholding is correct, especially when switching jobs.

Things You'll Need

• Pay stub
• Calculator

Instructions

1. Give notice at your old job and determine the start date of your new job. Your former employer will issue any remaining paychecks to you, along with any severance pay you are due. These payments include the withholding for Social Security.

2. Check your last paycheck and any other payments to be sure the proper amount of Social Security tax was withheld. As of 2011, employees pay Social Security taxes at a rate of 4.2 percent, up to the earnings cap of $106,800. As of 2012, that rate is slated to increase to 6.2 percent.

3. Contact your former employer if he failed to withhold enough in Social Security taxes to cover your liability, or if he withheld too much. It is the employer's responsibility to withhold the proper taxes from your paycheck and severance package.

4. Review the first paycheck you receive from your new employer carefully. Contact your human resources representative immediately if the company failed to withhold the proper amount of Social Security taxes.

References

• CNN; Tax Cut Deal -- What To Expect in Your Paycheck, Jeanne Sahadi; December 2010