Text Version:

Railroad Employee Taxes and Wage Bases for 2012

Notes:

• Tier I tax rate and wage base same as under social security. December 2010 legislation temporarily lowered the social security payroll tax rate on employees, and the corresponding tier I payroll tax rate on railroad employees, by 2 percentage points for calendar year 2011. Subsequent legislation extended the temporary reduction through February 2012.
• Employer pays tier I tax rate of 7.65% on $110,100 wage base in 2012; also pays tier II tax of 12.10% on $81,900 base. 
• Employer and employee tier II rates are based on the ratio of certain asset balances to the sum of benefits and administrative expenses.
• If excess tax withheld from two employers, credit may be due employee and claimed on Federal income tax return.  See IRS publication 505, Tax Withholding and Estimated Tax.