(NEW YORK) — Back in January, a temporary cut in payroll tax expired, causing more money to be taken out of Americans’ paychecks. But as a new survey for Bankrate finds, most really didn’t seem to notice.
“More than half of working Americans either haven’t noticed or they’ve been unaffected by the expiration of the payroll tax cut,” says Greg McBride, a senior financial analyst for Bankrate.
He says this was especially true for households with lower incomes.
“Most surprisingly, it’s the lowest income households — those that were expected to be the most impacted by the expiration of that payroll tax cut — that were most inclined not to have noticed the expiration at all,” McBride says.
“These are households that have the highest propensity to spend whatever they bring through the door,” he explains. “And so the concern from an economic standpoint was, you have a lot of households suddenly have less money to spend and there would be an economic impact. At least so far, we haven’t seen that.”
But, as McBride points out, the Americans that did notice the bigger bite in taxes may surprise you.
“About 30 percent of Americans say that they have cut back on their spending because of the expiration of the payroll tax cut. And most surprisingly, this was in the income group of households between $50,000 and $75,000 a year,” he says.
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