Congress approves 2-month extension of payroll tax holiday

On December 23rd Congress approved, and the President signed, a bill (H.R. 3765) to maintain the 4.2 percent Social Security payroll tax paid by employees — which was reduced from 6.2 percent last year — through the first two months of 2012. The bill also maintains, for two months, expanded unemployment benefits and current payment rates for doctors who see Medicare patients.  Without action by Congress, all three provisions would have expired on December 31, 2011. In January, Congress is expected to begin negotiations on how to extend the provisions through the remainder of 2012.

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