Government News

2021 Federal Rates

  • SSA wage base $142,800

  • Employee SS rate 6.2%

  • Employer SS rate unchanged 6.2%

  • Medicare rate 1.45%

  • Medicare rate for wages greater than $200,000  2.35%

  • Standard business mileage rate 56 cents per mile

  • Medical or Moving mileage rate 16 cents per mile

  • Service of charitable organizations mileage rate 14 cents per mile


 2021 RevenuE Fringe Benefit

  • Adoption credit-$14,440

    • The amount excludable from an employee’s gross income begins to phase out for taxpayers with an adjusted gross income of $216,660) and is completely phased out for taxpayers with an adjusted gross income of $256,660.

  • Health FSA Limit- $2,750  (Max carryover amount is $550.00)

  • Parking- $270.00

  • Commuter Highway vehicle & Transit Passes-$270.00

  • Medical Savings Accounts
    • High Deductible
      • Individual-$2,400-$3,600
      • Family-$4,800-$7,150
    • Maximum Out-of-Pocket
      • Individual coverage-$4,800
      • Family- $8,750

 

  • Long-term care insurance benefits
    • Amount excluded from income capped at $400 per day

 

  • Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) -For 2021, a qualified small employer health reimbursement arrangement (QSEHRA) is an arrangement that, among other requirements, makes payments and reimbursements for qualifying medical care expenses or family members
    • Do not exceed $5.300 Eligible employee 
    • $10700 for family members of the employee
  •  

Pension Plan, Deferral Limits Announced for 2021

IRS announced the 2021 Pension Limits. See the list below.  

Traditional and Roth IRA contributions-$6,000

Traditional and Roth IRA catch-up contributions-$1,000

Annual additions under IRC Sec. 415(c)(1)(A) for defined contribution plans: $58,000 

Annual additions under IRC Sec. 415(b)(1)(A) for defined benefit pension plans: $230,000

Annual IRC Sec. 402(g) deferral limit for 401(k), 403(b) and 457(b) plans: $19,500

Catch-up contributions to 401(k), 403(b) and 457(b) plans: $6,500 

Annual deferral limit for SIMPLE IRA and SIMPLE 401(k) plans: $13,500 

Catch-up contributions for SIMPLE IRA and SIMPLE 401(k) plans: $3,000 

Annual IRC Sec. 408(k)(2)(C) deferral limit for SEPs plans $650

IRC Sec. 401(a)(17) compensation cap: $290,000 

Highly compensated employee definition income threshold: $1305,000 

Top-heavy determination key employee definition income threshold: $185,000 

SEP plan employee income threshold for benefit eligibility: $650 

For more information please visit the IRS [Notice 2020-79, 10-26-20].   


2020 FUTA Credit Reduction States

On November 10, 2020, the U.S. Department of Labor (DOL) announced Virgin Islands is the only state/territory subject to the  FUTA credit reduction for 2020.  This means the employers in these states will be required to pay additional FUTA taxes in the 4th quarter FUTA tax deposit due no later than January 31, 2021.

The reasons why the employers are subject to this tax are due to Virgin Island unable to pay back the outstanding federal unemployment loans by November 10, 2020.  Below is the Virgin Islands Futa credit reduction rate along with their FUTA rate for 2020. 

State/Territory

2020 Credit Reduction

2020 FUTA Rate

Virgin   Islands

3.0%

 3.6%

 


State Updates

The following states below have announced their 2021 Wage Base Limits. ( AS OF 12/22/2020)

State 2021 Wage Base   State 2021 Wage Base
ALABAMA 8,000   MISSISSIPPI 14,000
ALASKA 43,600   MISSOURI 11,000
ARIZONA 7,000   MONTANA 35,300
ARKANSAS 10,000   NEBRASKA 9,000*
CALIFORNIA 7,000   NEVADA 33,400
COLORADO 13,600   NEW HAMPSHIRE 14,000
CONNECTICUT 15,000   NEW JERSEY 36,200
DELAWARE     NEW MEXICO 27,000
DISTRICT OF COLUMBIA 9,000   NEW YORK 11,800
FLORIDA 7,000   NORTH CAROLINA 26,000
GEROGIA 9,500   NORTH DAKOTA  
HAWAII 47,400   OHIO 9,000
IDAHO 43,000   OKLAHOMA 24,000
ILLINOIS 12,960   OREGON 43,800
INDIANA 9,500   PENNSYLVANIA 10,000
IOWA 32,400   RHODE ISLAND 24,600**
KANSAS 14,000   SOUTH CAROLINA 14,000
KENTUCKY 11,100   SOUTH DAKOTA 15,000
LOUISIANA 7,700   TENNESSEE  
MAINE 12,000   TEXAS 9,000
MARYLAND 8,500   UTAH 38,900
MASSACHUSETTS 15,000   VERMONT 14,100
MICHIGAN     VIRGINIA 8,000
MINNESOTA     WASHINGTON 56,500
MASSACHUSETTS 15,000   WEST VIRGINIA 12,000
MICHIGAN     WISCONSIN 14,000
MINNESOTA     WYOMING 27,300

*Nebraska – new for 2020, $24,000 for employers assigned to rate category 20.

**Rhode Island – $26,100 for employers in the highest UI tax rate group.

 


Forms & Publications

Form 1096

2020 Form 1099 Misc.

2021 Form 1099 Misc.

2020 Form 1099 NEC

2021 Form 1099 NEC

Form I-9

Form W-2

Form W-2C

Form W-3

Form W-4

Form W-2  W-3 Instructions

Form WH347

Form 940

Form 940 (Schedule A)

Form 941

Form 941 Instructions

Form 941 Schedule B

Form 943

Form 943 Instructions

Form 944

Form 944 Instructions

Publication 15 (Circular E), Employer's Tax Guide

Publication 15-A Employer's Supplemental Tax Guide

Publication 15-B Employer's Tax Guide to Fringe Benefits

Publication 15-T Federal Income Tax Withholding Methods

Publication 509 Tax Calendars

 


 

Resource Links

401K Helper

American Payroll Association (APA)

APA's VISA-PAYCARD PORTAL

Direct Deposit Information 

EEOC 

Department of Labor

Federal Office of Child Support Enforcement

Federal Tax Withholding

IRS 

IRS Services Guide

NACHA

National Archive & Records Administration 

Society for Human Resource Management (SHRM)

State New Hire Reporting Websites

VA-4 Employee's Withholding Exemption Certificate

Virginia New Hire Form

Virginia Statewide Payroll Conference

Unclaimed Property

US Dept of Health & Human Services  

US Immigration


Resource Material

Bloomberg BNA 

IRS Service Guide

RIA and WG&L

Wolters Kluwer CCH Payroll Management Guide


Virginia Statewide Payroll conference Affiliated APA Chapters

Colonial Capital Chapter

Hampton Roads Chapter

Richmond Chapter

Southwest Virginia Chapter of the APA

Washington Metro Area Chapter

Charles Town West Virginia Chapter