In the national coverage of the fiscal cliff negotiations, much attention was given to the expiration of the break on payroll taxes. News articles may have left the impression that OPERS members would be included with all other workers regarding the Social Security portion of the payroll tax.
Two years ago the government granted contributors to Social Security a temporary, 2 percent reduction on the Social Security payroll tax. The cut put, on average, an extra $1,000 into the pockets of the typical working family, the Associated Press reported.
Recently, Congress allowed that tax cut to expire in the fiscal cliff deal.
Media reports last week have generally portrayed the temporary tax cut as affecting all U.S. workers:
- CNN reported that “for the past two years, everyone in this country has enjoyed a payroll tax deduction of 2 percent.”
- The Wall Street Journal stated that “the end of the tax break would effectively raise taxes for all wage earners (in 2013).”
- Yahoo Finance ran a story titled, “Payroll Tax Cut Expiration Is a Bigger Deal Than You Think,” which contained the following (we added the emphasis as warranted): “For as picked over and criticized as the Fiscal Cliff deal has been over the last few days, a tax break getting less attention than may have been expected is the one thing that impacts anyone taking home a paycheck. With the expiration of a temporary Social Security payroll tax everyone’s take home pay just fell 2%.”
Of course, OPERS members do not contribute to Social Security, so they did not receive the payroll tax break. So while our members will not see their paychecks shrink in 2013 with the expiration of the tax, it was just as true two years ago that they didn’t see their paychecks increased as did most other workers.
Ohio is a non-Social Security state, as we reminded members in a blog on Sept. 8, 2011. In fact, OPERS members pay at least 10 percent of their salary toward their retirement. Recent news articles that included OPERS members with all other workers regarding the Social Security portion of the payroll tax are inaccurate.
middletown city school district contracted us out now we have to pay into both ,this is not right
i think and always thought everybody that gets a paycheck should pay s.s. even if you work where they have their own retiment system , this way our kids can retire .
That’s an idea, Jim, and wanting our descendants to have SS does you credit in an age when most don’t seem to care.
However, raiding the tax revenues of the payroll tax and leaving unbacked IOUs in their place has been the Federal government’s policy for decades no matter who was in power. Whether we pay or not, now, makes no difference whatsoever. When our children retire and draw SS, there’ll be no surplus to draw from, only the then current government’s ability to fund such by other taxation or borrowing.
Jim, I couldn’t agree with you less! What you propose constitutes taxation without representation. Why should any of us pay a tax that WE will not benefit from? Furthermore, if you compare your monthly pension benefit against that of someone receiving Social Security, (who was earning about the same amount of money), you would realize that there is no way you could survive on that little bit. Social Security IS NOT A PENSION!
Sorry, Jim, I also disagree with you. Why continue to reward a government for fiscal incompetence? Another money grab by the government, this one from PERS members, won’t solve the debt issues facing Social Security or the government in general; they’re simply too massive. Those will only be solved by cutting spending and living within its means, like everyone in this country is expected to do.
The money for Social Security recipients should have been there, but the government stole it to use for other projects. Now they’re facing red ink and expect to be bailed out once again.
At some point, you have to say no or it just won’t stop.