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To determine:
federal insurance contribution act(FICA) contribution amount made by the employer of J.
Introduction:
FICA stands for federal insurance contribution act tax it is a U.S employment tax that imposed by U.S government on both employer and employee. The tax amount used for the welfare of disabled people, senior citizens and other needed section of society.
![Check Mark](/static/check-mark.png)
Explanation of Solution
If a person is an employee and not self employed, then the employee and the employer make a contribution of 7.65% of gross salary up to a limit of $106,800 to FICA.
Given,
J earned $ 51,250 this year.
Formula to calculate FICA contribution,
Substitute $51,250 for gross salary in the above formula.
Hence, the FICA contribution by employer is $3,920.63.
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