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Rock Hill, SC 29733, USA
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2020 Form W2 Box 14 Statement

Social Security Taxes for 2021

The Social Security Administration (SSA) announced that the Social Security wage base will  increase in 2021. The wage base will be $142,800.00 beginning with the first payroll of 2021. The maximum contribution will be $8,853.60. The Medicare portion of FICA does not have a wage base or maximum contribution; however, 2021 wages in excess of $200,000 will be subject to an extra 0.9% Medicare tax.

FICA tax that comes out of your check each payday is the social security tax. The FICA tax rate for 2021 is 6.2% for both the employee and employer. The MQFE tax is the Medicare portion and is taxed at the rate of 1.45% of taxable wages and has no maximum.


Optional Life Insurance

The premiums you pay through payroll deduction for the first $50,000 of Optional Life Insurance are now treated as pre-tax dollars. This means the deduction reduces your taxable wages before taxes are calculated on the wages. The premiums for coverage over $50,000 will be treated as any other payroll deduction.

Retirement Plan Limitations for 2021

The IRS has announced that the limitations on retirement plans for 2021 are as follows:

401(K), 457(e), and 403(b) Deferred Limit

$ 19,500

Age 50+ Catch-up Contributions Limit

$ 6,500

457(b) Pre-Retirement Catch-up Limit

$ 19,500

*Annual amount may differ for individual participants in certain cases.

 

Last Updated: 1/21/21