Social Security taxes are 6.2% up to wages $106,800 (for 2009) - http://www.ssa.gov/pubs/10003.html
There is no exemption from SS tax unless your wages are above that level.
If you file W-4 form with EXEMPT provision - you will only exempt form income tax withholding.
Please let me know if you need any help.
My gross income is $230,000 a year.
My first job is $170,000/yr
My second job is $60,000/yr
Both jobs are taking full Social Security taxes out. The first one qualifies me for maximum amount and the second social security tax withdrawl (60,000/yr job) comes out, but I essentially get it all back at end of year and want to collect during the year, thus my question
So, can I raise raise my state tax exemption so that I get less at end of year to compensate for paying Social Security taxes on both jobs.
Yes - that would be OK to increase the number of exemptions to offset additional social security tax withheld from the second job.
As long as you will not owe any taxes at the tax time - there will not be any issues.
You need to estimate your total tax liability considering all income, filing status, deductions and SS tax refund and your withholding from both jobs with a particular filing of W-4 form.
Let me know if you need help with estimation.
However - that will affect only federal taxes.
State income tax withholding should not be affected.