The word is out that most people can expect a little less in their paychecks now because the lower FICA rate (4.2%) was not extended with all of the other fiscal cliff tax breaks. The rate has gone back to 6.2%. Because of that, taxpayers working in Kansas might have missed their new lower state withholding.
The Kansas legislature passed a major tax package this summer. Besides ending tax on business income, they cut the tax rates to 3 and 4.9%. This tax cut is what is showing up on paychecks now.
The amount of the cut will of course depend on the wages. A taxpayer who is paid $1000 every 2 weeks and has their KW-4 set for single and 1 will see their KS withholding drop from $35 to $28. If their KW-4 is Married and 2, the drop is from $22 to $18.
The new tax rates are:
- Married – 3% for income under $30,000. 4.9% for any income above that.
- Everyone else – 3% for income under $15,000. Above that the rate is 4.9%.
So, if you’re working in Kansas, check and make sure that you KS withholding went down from last year. It won’t totally offset the hike in FICA but it does help some.