Finance News & Insights

Feds release 2019 taxable wage base

Alert your Payroll team! A mission-critical figure for 2019 has arrived, a few weeks earlier than usual: the new taxable wage base.

That’s the first of the “big 3” year-end updates finance pros wait for beginning this month (the standard mileage rate and pension plan limits are the others).

So what are we looking at in the new year?

The taxable wage base for 2019 will jump to $132,900, announced the Social Security Administration. That’s up $4,500 from the current $128,400 threshold for 2018.

And while it’s not the biggest jump your company has experienced (2016 into 2017 was almost double that, even larger than predicted), it does set a new record as being the highest taxable wage base to date.

Several rates holding steady

Not everything’s changing on this front, though.

Note: The Social Security portion (OASDI) tax rate for wages will hold steady at 6.2% for both employees and employers. And the Medicare portion (HI) will go unchanged at 1.45%

Of course, your staffers will need to update your payroll system so the correct amount of Social Security tax is withheld in 2019 or confirm that your payroll service provider makes the change if you outsource. You’ll want to get this new number into their hands ASAP so they can check one task off their year-end to-do list.

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