This year-end will be one of the most hectic
The Social Security taxable wage base is about to make one of its biggest jumps – ever. Add to that the many other changes already piled on for this year-end, and you wonder how you’re going to keep your head above water.
Here’s the latest: The SSA announced the 2017 taxable wage base will increase from $118,500 to $127,200.
That means $8,700 more of each employee’s earning will be subject to Social Security tax in 2017.
Doing the math using the 6.2% tax rate, employees and employers will each pay a maximum of &7,886.40 for the tax in 2017. That’s an increase of $539.40 from 2016.
Consider passing that bottom line information along to your CFO. Also, of course, you’ll need to update your payroll system so the correct amount of Social Security tax is withheld in 2017, or confirm that your payroll service provider makes the change.
That’s straightforward enough.
But the checklist goes on, making this one of the most hectic year-ends for businesses – whether it’s forms or laws and regs, not to mention a topsy-turvy election.
What you’re up against
Beat the clock with Forms W-2
For the first time ever, the deadline for submitting, Copy A to SSA is Jan 31, 2017. You’re under pressure, because forms are due to employees then, too.
Get up-to-speed with Form I-9. The form was recently overhauled, and you need to start using the new I-9 by Jan. 21, 2017.
Don’t count on Affordable Care Act transition relief. You barely learned the ropes with the 2015 Form 1095, and now for Tax Year 2016, almost every type of Sec. 4980H transition relief is gone. Note: The IRS finally released the 2016 Form 1095 and instructions.
Keep your eye on the OT regs. White collar exempt employees will need to be paid at least $913 per week as of Dec. 1, 2016. But the changes are being contested, so don’t be surprised if you end up hitting the brakes.
Brace for political shifts. With a new president being sworn in Jan. 20, 2017, law and reg upheaval is likely.