Fiscal Cliff May Affect UT Paychecks
Employees at the University of Texas at Austin may see their paychecks cut by two percent next month.
Social Security withholding taxes are scheduled to go up as part of the menu of tax changes Washington is calling “the fiscal cliff.” Lawmakers would have to reach a deal to extend the payroll tax holiday by Dec. 20 to give UT’s payroll department enough time to process it before the Jan. 2 payday.
“It’s tough because employees really don’t know everything that’s going on about the law and what the fiscal cliff is and what may be changing,” said Leslie Saucedo, director of payroll services at UT. “They do know that there’s an impact to their paycheck and they don’t always know why. And so trying to make sure we get the word out prior to the Jan. 2 payday, that’s our plan.”
Saucedo says UT would not immediately implement a higher federal income tax rate, even if Congress and the President fail to reach a deal to extend the Bush-era tax cuts.