Bill > S1917

This bill, the Middle Class Tax Cut Act of 2011, aims to stimulate the economy by providing temporary payroll tax relief and introducing a new surtax on high earners. For the calendar year 2012, it reduces the employment tax rate, also known as the payroll tax, for both employers and employees to 3.1% on wages. This reduction is capped for employers at the first $5 million of wages paid. Self-employed individuals will also see their tax rate reduced on the first $5 million of their net earnings. Additionally, the bill offers a tax credit to non-governmental employers for increases in their payroll during the last quarter of 2011 and throughout 2012. To offset any revenue loss to Social Security trust funds resulting from these tax reductions and credits, the bill appropriates funds to those accounts. For taxable years beginning after 2012, the bill imposes an additional tax of 3.25% on modified adjusted gross income (which is adjusted gross income minus deductions for investment interest) exceeding $1 million, with this threshold amount to be adjusted for inflation annually starting in 2013.