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November 28, 2017
2017-2002

SSA lowers the 2018 Social Security wage base from what was previously announced

On November 27, 2017, the Social Security Administration (SSA) announced that due to its receipt in late October 2017 of approximately 500,000 Form W-2 corrections for tax year 2016, it has now lowered the 2018 Social Security taxable wage base to $128,400, down from the $128,700 it originally announced on October 13, 2017.

The revised 2018 wage base of $128,400 is lower than the $130,500 projected in the July 2017 Annual Report of The Board of Trustees.

The Medicare tax rate for 2018 remains at 1.45% of all covered earnings for employers and employees. For wages in excess of $200,000, the Additional Medicare Tax of 0.9% applies to earned income of more than $200,000 ($250,000 for married couples filing joint). While employers are required to withhold the additional 0.9% on covered wages in excess of $200,000, there is no employer matching contribution.

For a quick reference chart see the following page.

For the federal and state rates and limits for 2017 see our special report.

For the original SSA fact sheet for 2018 go here.

For the revised SSA fact sheet for 2018 go here.

Social Security, Medicare and Disability insurance contributions

2017 to 2018

Description

2017

2018

Increase

Social Security Tax Rate For Employees

6.20%

6.20%

-0-

Social Security Tax Rate for Employers

6.20%

6.20%

-0-

Social Security Wage Base

$127,200

$128,400

$ 1,200

Maximum Social Security Tax for employees

$ 7,886.40

$ 7,960.80

$ 74.40

Medicare Tax Rate for Employers

1.45%

1.45%

-0-

Medicare Tax Rate for employees

1.45%*

1.45%

-0-

Medicare Tax Rate for employees on wages above $200,000*

2.35%

2.35%

-0-

Medicare Wage Base

No Limit

No Limit

N/A

* Employers must withhold an additional Medicare tax of .9% of wages in excess of $200,000. There is no employer matching contribution.

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Contact Information
For additional information concerning this Alert, please contact:
 
Workforce Advisory Services — Employment Tax Advisory
• Debera Salam(713) 750-1591;
• Kristie Lowery(704) 331-1884;
• Kenneth Hausser(732) 516-4558;
• Debbie Spyker(720) 931-4321;

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