Press Releases

Feinstein: Cut Payroll Tax for California Families

Immediate tax relief for 17 million Californians; saves average family more than $1,800 in 2012

Washington—Senator Dianne Feinstein (D-Calif.) is supporting a Senate bill to extend and expand a reduction in the payroll tax rate paid by employees in 2012—a plan that provides immediate tax relief to 17 million California taxpayers and saves the average California family more than $1,800 in 2012.

The Middle Class Tax Cut Act cuts the employee Social Security payroll tax rate in half from 6.2 percent to 3.1 percent on the first $110,100 of taxable wages and will save California workers $20.7 billion in 2012. This tax cut is paid for with a 3.25 percent surtax on taxpayers earning more than $1 million annually.

Senator Feinstein said: “Cutting the payroll tax in half will put an average of $1,800 in each California family’s pocket. In 2012 this tax cut saves 17 million working Californians more than $20 billion. This is one additional effort we can make to move the economy forward and increase the buying power of our citizens. Bigger paychecks will hopefully help struggling families and promote economic growth.”

Leading economists support extending the payroll tax cut in 2012 to promote economic growth, create demand and increase job creation.

A county-by-county list detailing savings from the Middle Class Tax Cut Act is below:

Median Household Income

Savings From Payroll Tax Cut (Median Family)

Tax Increase For Median Family
If Tax Cut Expires

California

$58,925

$1,827

$1,179

Alameda County

$68,258

$2,116

$1,365

Alpine County

$45,391

$1,407

$908

Amador County

$54,461

$1,688

$1,089

Butte County

$41,196

$1,277

$824

Calaveras County

$51,564

$1,598

$1,031

Colusa County

$47,472

$1,472

$949

Contra Costa County

$75,084

$2,328

$1,502

Del Norte County

$38,252

$1,186

$765

El Dorado County

$68,778

$2,132

$1,376

Fresno County

$45,219

$1,402

$904

Glenn County

$41,904

$1,299

$838

Humboldt County

$35,985

$1,116

$720

Imperial County

$37,846

$1,173

$757

Inyo County

$44,090

$1,367

$882

Kern County

$46,938

$1,455

$939

Kings County

$44,102

$1,367

$882

Lake County

$36,895

$1,144

$738

Lassen County

$46,377

$1,438

$928

Los Angeles County

$54,375

$1,686

$1,088

Madera County

$42,769

$1,326

$855

Marin County

$86,658

$2,686

$1,733

Mariposa County

$42,775

$1,326

$856

Mendocino County

$41,488

$1,286

$830

Merced County

$39,922

$1,238

$798

Modoc County

$34,290

$1,063

$686

Mono County

$53,973

$1,673

$1,079

Monterey County

$57,647

$1,787

$1,153

Napa County

$66,970

$2,076

$1,339

Nevada County

$57,250

$1,775

$1,145

Orange County

$71,735

$2,224

$1,435

Placer County

$70,751

$2,193

$1,415

Plumas County

$42,684

$1,323

$854

Riverside County

$55,151

$1,710

$1,103

Sacramento County

$52,502

$1,628

$1,050

San Benito County

$61,281

$1,900

$1,226

San Bernardino County

$52,137

$1,616

$1,043

San Diego County

$60,103

$1,863

$1,202

San Francisco County

$70,247

$2,178

$1,405

San Joaquin County

$52,201

$1,618

$1,044

San Luis Obispo County

$55,638

$1,725

$1,113

San Mateo County

$84,678

$2,625

$1,694

Santa Barbara County

$58,555

$1,815

$1,171

Santa Clara County

$84,990

$2,635

$1,700

Santa Cruz County

$60,816

$1,885

$1,216

Shasta County

$42,552

$1,319

$851

Sierra County

$41,788

$1,295

$836

Siskiyou County

$39,218

$1,216

$784

Solano County

$65,079

$2,017

$1,302

Sonoma County

$61,985

$1,922

$1,240

Stanislaus County

$48,550

$1,505

$971

Sutter County

$48,073

$1,490

$961

Tehama County

$38,179

$1,184

$764

Trinity County

$33,546

$1,040

$671

Tulare County

$39,876

$1,236

$798

Tuolumne County

$48,027

$1,489

$961

Ventura County

$71,246

$2,209

$1,425

Yolo County

$56,120

$1,740

$1,122

Yuba County

$40,947

$1,269

$819

The Middle Class Tax Cut Act:

  • Cuts the payroll tax in half for 98 percent of U.S. businesses. The bill cuts in half (from 6.2 percent to 3.1 percent) the Social Security payroll tax paid by employers on the first $5 million of taxable payroll for 2012.
     
  • Gives an added incentive for businesses to hire. The bill completely eliminates (from 6.2 percent to 0 percent) the Social Security payroll tax paid by employers on the first $12.5 million of an employer’s increased taxable payroll for the 4th quarter of 2011 and $50 million in increased payroll for 2012.
     
  • Protects Social Security. The bill transfers funds from the General Fund to the Social Security Trust Fund to ensure that Social Security is unaffected by this temporary payroll tax relief.

###