How is My Tax Money Used?
Goffstown, NH Resident Has Questions About Where Her Money is Going
The money withheld for federal taxes goes to support a variety of expenses and programs. There are three biggest expenditures for the federal government that are funded by our tax dollars. These include health programs such as Medicare and Medicaid, social security, and defense. The largest portion of this tax money is used for healthcare and social security, with more than half of tax money being used to support these programs. Another percentage is dedicated to pay interest on the national debt. The remaining federal tax dollars are used to fund government programs including energy, education, and agriculture.
A Goffstown resident was feeling frustrated with the amount of federal taxes withheld from her paycheck. She began to question how this tax money was being used.
Looking at the Tax Withholding Breakdown on Your Paycheck
If you look at your pay stub, you will likely see several withholdings listed for federal income taxes. These include Federal Insurance Contributions Act (FICA), Medicare, and Social Security tax. The latter are monies used to fund your future participation in these federal programs. FICA is money withheld by employers and employees to fund Social Security and Medicare. This money provides necessary benefits for retirees, people with disabilities, and children of deceased workers.
Taxes Support Federal Spending and Important Government Programs
While it is easy to complain about having to pay taxes, this money is necessary to keep the government functioning. Behind the core programs for healthcare and social security, tax money is used to fund highways, police, defense, and the federal justice system among others. State taxes, whether from income tax, property tax, sales tax, and more, are used to operate state-run programs. This money is also used to support the public education system, maintain roads, and support local fire and police departments.
The breakdown of how the money is spent is outlined in the federal budget and can be made available to anyone looking for this level of detail. The Goffstown resident now has a better understanding of how her tax money is being spent. She can rest assured knowing that she is helping to contribute to keeping some of the country’s most critical programs in operation.