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SOCIAL SECURITY MEDICARE TAXES <br />Finance Director Ed Fry came before the Board to discuss the <br />newly mandated Social Security Medicare Taxes, as follows: <br />TO: The Honorable Members DATE: June 10, 1986 FILE: <br />of the Board of County Commissioners <br />SUBJECT: social Security Medicare Taxes <br />FROM: Finance Department REFERENCES: <br />Beginning April 1, 1986, all newly hired state and local employees must be <br />covered under Medicare., <br />This was mandated by a bill signed by the President on April 7, 1986, making it <br />Public Law 99-272. <br />This means that at 1986 contribution rates employers must contribute 1.45 <br />percent of an employee's salary with the worker making an equal matching <br />contribution for a total of 2.90 percent of payroll on the first $42,000 of <br />salary. <br />Director Fry explained that the end result is that for all <br />employees who have be°'en hired since April 1, 1986 and those hired <br />in the future not only will we have the 7.15% FICA contributions <br />but 1.45% contribution for the Medicare program; so, those <br />contributions will total 8.6% on each employee. Part comes out <br />of the employee's pay and is matched by the County. So far this <br />only covers employees hired after April 1, 1986, but there has <br />been extensive discussion about broadening this to cover all <br />employees at some time and that would generate a considerable <br />increase in the County budget. Director Fry continued that no <br />action is required at this time; he just wished the Board to be <br />aware of what is occurring and what could happen to increase the <br />tax burden. <br />51 <br />JUN 18 1986 <br />BOOK 64 F,�,F 745 <br />