Question
a mandatory tax that is used by the government to provide old age and disability insurance
Answers
GPT-4o mini
The tax you are referring to is most likely the **Federal Insurance Contributions Act (FICA) tax** in the United States. FICA taxes are collected to fund two primary programs: Social Security and Medicare.
- **Social Security** provides old-age retirement benefits, as well as disability and survivor benefits.
- **Medicare** offers health insurance for people aged 65 and older, as well as certain younger individuals with disabilities.
FICA tax is mandatory for employees and their employers, with contributions drawn from wages and salaries. Self-employed individuals pay a similar tax called the Self-Employment Contributions Act (SECA) tax.
- **Social Security** provides old-age retirement benefits, as well as disability and survivor benefits.
- **Medicare** offers health insurance for people aged 65 and older, as well as certain younger individuals with disabilities.
FICA tax is mandatory for employees and their employers, with contributions drawn from wages and salaries. Self-employed individuals pay a similar tax called the Self-Employment Contributions Act (SECA) tax.