How much you want to bet Congress extends the 4.2% and makes it retroactive? Geezzz, I hate it when they do stuff like that.I'll take that bet as long as the stakes are reasonable. A batch of my award-winning peanut brittle on this end?The payroll tax holiday, masked originally as the "Making Work Pay Credit," was a temporary measure to stimulate the economy. I haven't heard any broad support for extending it. With the economy in recovery and talk about the necessity of reining in entitlement spending I don't expect it to be renewed.I don't think WH is as difficult to deal with. Of course, it depends on how much the rates change. I imagine that the payroll services and payroll software developers already have 2013 income tax withholding information based on current 2013 law. It's much easier to smoosh this once the dust settles since they have all the way to 12/31/2013 to balance things out. I imagine that if IRS doesn't have word of a firm deal by the 26th there will be a mailing to all employers.A bigger problem is if there is an agreement. While the inflation adjustments are old news, nobody knows what they might come up with beyond the 25% bracket even if they leave the lowest three in place. There may be multiple versions sitting around IRS HQ waiting for a puff of white smoke, but I suspect there's also a lot of hair pulling.PhilRule Your Retirement Home Fool
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