The payroll tax increase that went into affect at the beginning of the year stands to offset significantly the President's proposal to raise the federal minimum wage to $9 an hour.
In his State of the Union address, Barack Obama called on lawmakers to increase the federal minimum wage from $7.25. For an employee working a 40 hour work week, the bump would translate to a 24 percent raise to $18,720 a year.
However, because of the payroll tax hike that went into affect on January 1, 10 percent of that raise, or $374, would be lost due to the payroll tax hike, according to a calculator provided by the Wall Street Journal.
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