The questions are already rolling in: "Why did my pay drop?" The simple answer is the expiration of the payroll tax holiday as part of the fiscal cliff deal. The payroll tax holiday was enacted in 2011, which reduced the employee share of the Social Security payroll tax from 6.2% to 4.2%. The holiday was not renewed when it expired at the end of 2012. The payroll tax holiday proved popular, but it cut federal revenues by some $10 billion per month.
