Based on the information given the total annual FICA tax for an annual salary is: c. $8,221.39.
FICA tax comprises of Social security tax and Medicare tax
Where:
Social security tax=6.2%
Medicare tax=1.45%
To determine the total annual FICA tax the social security tax of 6.2% will be taxed on maximum taxable earnings while the Medicare tax of 1.45% will be taxed on the annual salary.
Hence:
Social security tax=6.2%×$106,800
Social security tax=$6,621.6
Medicare tax=1.45%×$110,330
Medicare tax=$1,599.785
Total annual FICA tax=$6,621.6+$1,599.785
Total annual FICA tax=$8,221.385
Total annual FICA tax=$8,221.39 (Approximately)
Inconclusion the total annual FICA tax for an annual salary is: c. $8,221.39.
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