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(PDF) Payroll Accounting Assignment

   

Added on  2021-04-24

4 Pages824 Words43 Views
Running head: PAYROLL ACCOUNTINGPayroll AccountingName of the Student:Name of the University:Author’s Note:

PAYROLL ACCOUNTING2Federal Insurance Contribution ActFederal Insurance Contribution Act (FICA) is a tax policy of United States which ischarged on both employee and employer. The funds collected from this tax is used for the benefitof the retiree, children and used for social security and medical care of children, retired oldpersons (Social Security Administration, Office of Policy & Office of Research., 2013). In recenttimes a proposal was made which required that individuals can create a separate retirement fundand have control over the money that is to be invested in the retirement fund. It can be said thatthe proposal is justified as the worker will then get control over the amount of fund which he caninvest in the retirement fund. Moreover, this will be suitable for workers who wants to investmore in the retirement fund based on the capability of the individual. In addition to this the fundsas invested by the individual will be under the control of the investor as the separate retirementfund plan.Separate Investment FundInvestors should be allowed to invest in separate investment fund where such individualcan invest as per the capabilities of the individual. There should be an option where workers areallowed with a choice to either pay the payroll tax or create a separate retirement fund (Blumberget al., 2012). This program will then facilitate and will be able to cover wide range of workersand also results in investments which is good for the country. The investments of separateretirement fund will generally be done with an insurance company and the fees for managing theinvestment will be provided by the worker who is investing. The fees of insurance company aregenerally deducted as charges the fund invested.

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