Tax & Accounting Blog

New rates for 2018

Accounting Firms, CS Professional Suite Payroll Solutions, Payroll December 1, 2017

With the new year comes new rates. The federal rates are already set, but many state rates — especially State Unemployment Insurance (SUI) — are still being updated.

Due to a continuing low consumer price increase, many rates stay the same — however some, like 401(k)s, have had small increases. As of writing this report, the IRS has not extended 1095-C filing deadlines, which remains January 31, 2018 for the employee copies. Keep an eye out for updates as several organizations, such as the APA, have sent letters to the IRS asking for extensions for employers.

Here’s a rundown of the changes in the most commonly used rates and limits at this time.

FICA wage base (mid-forecast)
Date Wage
2018 $128,700 (announced)
2019 $135,500 (estimate)
2020 $142,200 (est.)
2021 $148,500 (est.)
2022 $155,100 (est.)
2023 $161,700 (est.)
2024 $168,000 (est.)
2025 $174,300 (est.)
2026 $180,900 (est.)
Source: https://www.ssa.gov/OACT/TR/2017/tr2017.pdf 

 

2018 rates
Item 2017 2018
Social Security  $127,200 $128,700
 – FICA (6.2%) $7,886.40 $7,979.40
 – Medicare (1.45%) $200,000 $200,000
 – Medicare (2.35%) >$200,000  >$200,000 
     
Domestic worker threshold  $2,000 $2,100
     
Elections workers  $1,800 $1,800
     
Transit passes / van pool / bike  $255 / $255 / $20  $260 / $260 / $20 
     
Parking  $255 $260
     
415(b)(1)(A) defined benefit max  $215,000 $220,000
     
Max. contribution  $54,000 $55,000
     
Education assistance    
Roth Limits (married; single) $186,000-$196,000; $118,000-$133,000  $189,000-$199,000; $120,000-$135,000 
401(k)  $18,000  $18,500
-403(b) – 457  $18,000  $18,500
-408(p) Simple $12,500  $12,500
     
401(k) catch-up  $6,000 $6,000
     
414(v) catch-up simple  $3,000 $3,000
     
IRA  $5,500-6,500<50 $5,500-$6,500<50
     
Foreign income exclusion  $102,100 $104,100
     
Minimum annual comp 408  $600 $600
     
Adoption exclusion limits  $13,570 $13,840
 – Phase Out Adjusted Gross Income (AGI) $203,540 $207,580
-Total exclusion AGI  $243,540 $247,580
     
Definition of control employee / commuting  $215,000 / $105,000  $220,000 / $110,000 
-Corp officer  $105,000 $110,000
-Earnings test  $215,000 $220,000
     
Definition of highly comp. $120,000 $120,000
 – Key employee top heavy plan $175,000 $175,000
 – Flexible Spending Account (FSA)        $2,600 $2,650
     
Long-term premiums     
-<40 $410 $420
-90 $770 $780
-10 $1,530 $1,560
-130 $4,090 $4,160
->70  $5,110 $5,200
     
Limitations     
 – Highly compensated 414 $120,000 $120,000
 – Annual compensation limits    
 – 414, 404, 408 Self-Employee Pension (SEP) $270,000 $275,000
 – Annual compensation limits    
 – 401 Government plans in effect 7/1/93 $400,000 $405,000
     
Health Savings Account (HSA)    
– Annual deduction limit Single/Family  $1,300 / $2,600 $1,350 / $2,700 
 – Maximum out of pocket single/family $6,550 / $13,100  $6,650 / $13,300 
 – Maximum annual contribution single/family $3,400 / $6,750  $3,450 / $6,900 
 – Maximum Annual Catch-Up (55 years old) $1,000 $1,000

 

Foreign income exclusions
Maximum Foreign Earned Income Exclusion  Housing Limit Base Housing Maximum Foreign Cost Exclusion
2015 $100,800 $30,240 $16,128 $14,112
2016 $101,300 $30,390 $16,208 $14,182
2017 $102,100 $30,630 $16,336 $14,294
2018 $104,100 $31,230 $16,656 $14,574

 
For more information about payroll tax compliance, see our new Help & How-to Center resource for state-specific info about payroll tax forms, due dates, filing methods, agency information, tax payment details, state ID formats, e-filing notes, new hire reporting requirements — and more!