Here comes the paycheck hit - FOX 13 News

Here comes the paycheck hit

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TAMPA (FOX 13) -

Lawmakers averted the so-called fiscal cliff, so it'll be a shock to some people who get their paychecks this week to find it a little bit smaller.

"When the Bush tax cuts were renewed a couple of years ago, President Obama wanted to give something to somebody else at the same time, so he lowered payroll taxes, the tax on social security, on everybody from 6.2 percent to 4.2 percent," explained Bill Newton of Consumer Action Network.

It adds up paycheck by paycheck.

If someone makes $50,000, you got almost a thousand dollars extra a year from the tax cut – designed to boost the economy.

People splurged.  It paid for iPads and cell phone bills. More items were sold at the register.

What will happen when it's taken away in increments of $30 to $50 every other week in every paycheck?

"What I would do is just cut back some of my other expenses, such as the cable TV and things like that.  I would do without," said Barbara Priddle.

"If I lost a thousand dollars a year, I probably would not be able to pay my bills," said Seth Grogan.

"If I would make a little less, I would just bartend a little more so I could make it up," said Mo Pickering.

Everyone won't have to make it up.

"It affects mostly lower income people for two reasons.  One we notice that bite out of the paycheck a little more.  The paychecks tend to be smaller.  They are smaller," Newton said.

Secondly, the current payroll tax cap is $113,000.  Anyone making more than that pays payroll taxes on just that amount.

"People who are less fortunate will suffer even more.  People who live paycheck to paycheck," said Corina Hill.

"It's going to make a difference.  It's going to hurt, but I guess I'll maintain," said Sheldon Slaughter.

You could think of it as paying it forward.  The tax provides for social security.  If it's not funded, you won't be seeing those checks once your paychecks stop rolling in after retirement.

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