Social Security Wage Base & Earnings Limits

Social Security Wage Base & Earnings Limits

social-security-largeWAGE BASE: same in 2016 as in 2015

The maximum wage an employee will pay social security on for 2016 is $118,500.  The rate is 6.2% on up to that amount.

There is no limit on the amount of wages for the 1.45% of Medicare tax withheld.

If you end up paying on more that $118,500 for Social Security either because your employer overwithheld or because you worked more than one job during the year then you will get the excess back on your tax return.

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EARNINGS TEST: same in 2016 as 2015

Those 62-65 years old by the end of 2016 can earn up to $15,720 before losing any benefits.

Those who turn 66 in 2016 can earn up to $41,880 before starting to lose any benefits.

Those over 66 in 2016 have no earnings limit.

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Publication 915 from the IRS

 

Linda Reinhardt

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