Each year, the IRS updates numbers based on inflation that affect payroll, retirement plans, and employee benefits. Here are some key figures for 2020:
Payroll
- Social Security Taxable Wage Base – $137,700
- Social Security Withholding Percentage – 6.2%
- Medicare Taxable Wage Base – unlimited
- Medicare Withholding Percentage up to earnings of $200,000 – 1.45%
- Medicare Withholding Percentage for earnings above $200,000 – 2.35%
Retirement Plans
- Maximum Salary Deferral for 401(k) & 403(b) Plans – $19,500
- 401(k) Catch Up Contribution for Employees age 50+ – $6,500
- Maximum Salary Deferral for SIMPLE Plans – $13,500
- Catch Up Contribution for SIMPLE Plans age 50+ – $3,000
- Maximum Contribution from all Sources (Employee and Employer) for Profit Sharing and 401(k) Plans – Lesser of 100% of employee’s compensation or $57,000
- Maximum Compensation Considered for Qualified Retirement Plans – $285,000
- Highly Compensated Employee Threshold – $130,000
- IRA Contribution Limit – $6,000
- IRA Catch Up for Individuals age 50+ – $1,000
Employee Benefits
- Medical Reimbursement Flexible Spending Account – $2,750
- Dependent Care Flexible Spending Account – $5,000
- Health Savings Account Contributions: Self-Only – $3,550
- Health Savings Account Contributions: Family – $7,100
For all these numbers in a nifty one page flyer, click here.
