Changes To Note

Social Security and Medicare tax for 2002. The social security wage base for 2002 is $84,900. There is no wage base limit for Medicare tax. The tax rate remains 6.2% for social security and 1.45% for Medicare tax.

Redesignation of Estimated Income Tax Payments as Employment Tax Deposits. If you determine that your income tax liability for your current tax year will be lower than the amount of estimated income tax payments you have already made, you may redesignate estimated income tax payments as employment tax deposits. You may use these redesignated payments to satisfy deposit liabilities for income tax withholding and social security, Medicare, railroad retirement, and Federal unemployment taxes. To make this redesignation, call 1-866-562-5227. Be certain your redesignation of these payments does not result in an underpayment of estimated income tax for the tax year. You may be subject to a penalty for underpayment of estimated income tax.

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