The Social Security wage base rises next year to $137,700, a $4,800 hike. The Social Security tax rate on employers and employees stays pat at 6.2%. Both will continue to pay the 1.45% Medicare tax on all compensation, with no cap. Individuals also pay the 0.9% Medicare surtax on wages and self-employment income over $200,000 for singles and $250,000 for couples. The surtax doesn’t hit employers. The nanny tax threshold goes up next year to $2,200, up $100 from 2019. Social Security recipients get a 1.6% increase in their benefits in 2020. The earnings test limits head up. Individuals who turn 66 next year will not lose any benefits if they earn $48,600 or less before they reach that age. Individuals who are 62 through 65 by the end of 2020 can make up to $18,240 before they lose any benefits. There is no earnings cap once a beneficiary turns 66. The amount needed to qualify for coverage increases to $1,410 a quarter.

Social Security Update

by | Nov 5, 2019 | Social Security, TallyTaxMan | 0 comments