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This is especially after working hard for a full year of money coming in. The 'payroll' tax applies at a fixed percentage of your working income - no brackets. The employee, instead of 6.2% of your working income for Social Security (only up to $106,800 income) and 12.45% of it for Medicare (no limit). Together they take additional 7.65% of your income. There's no tax threshold (or tax free) associated with income in this system.
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