Tax Tip Tuesday: Social Security Wage Base for 2019
The Social Security Administration has announced that the wage base for computing the Social Security tax in 2019 will increase to $132,900, up from $128,400 in 2018.
This means that for 2019, the maximum Social Security tax that employers and employees will each pay is $8,239.80 ($132,900 x 6.2%). A self-employed person with at least $132,900 in net self-employment earnings will pay $16,479.60 ($132,900 x 12.4%) for the Social Security part of the self-employment tax.
The Medicare component remains 1.45% of all earnings, and individuals with earned income of more than $200,000 ($250,000 for married couples filing jointly, $125,000 for married filing separately) will pay an additional 0.9% in Medicare taxes.
Disclaimer: The items included in the Tax Tip Tuesday Video Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation. IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.