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One Easy Planning Idea Based on the Recent Federal Tax Bill

Posted Wednesday, December 22, 2010 by Ronald L. Bueing

alt text As many of you have heard, President Obama has signed the 2010 Tax Relief Act. While, we are still digesting many of the changes, one easy tax planning idea that should be considered by anyone that has a year end bonus coming and is not over the Social Security wage base limit for 2010. Deferring payment of the bonus until 2011 will save 2% on the OASDI portion the Social Security tax that would otherwise be paid. In addition, if income is expected to exceed the wage base in 2011, the OASDI savings will be even higher as the bonus may avoid the OASDI tax completely.

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