Payroll and income tax issues have become increasingly complex. My weekly blog post will attempt to explain many of the new changes that might affect you without also putting you to sleep - let's see if that's possible:

For the first time since 1971 the Social Security wage base will not increase! In 2010 you will pay social security tax on the first $106,800 of earned income. The tax rates will not change either, with 6.2% going to FICA and 1.45% to Medicare. You may see a small increase in your Federal withholding tax. In 2009, the "Making Work Pay Credit" was introduced as a credit on earned income which was distributed by lowering withholding tax. This year it was spread over the last 9 months of the year, but in 2010 it will be spread over 12 months making your withholding slightly larger.

In short, this is good news for everyone who likes to hold on to more of their paycheck.

(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).