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New Minimum Wage Rates for Many States in 2016

The new year rings in new minimum wage rates, as well as new ACA reporting requirements. Keep in mind that January 2016 brings ACA reporting for ALEs—therefore, all ALE employers will have to provide every employee with a Form 1095-C by January 31, 2016.

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The new year rings in new minimum wage rates, as well as new ACA reporting requirements. Keep in mind that January 2016 brings ACA reporting for ALEs—therefore, all ALE employers will have to provide every employee with a Form 1095-C by January 31, 2016.

Due to a low consumer price increase this year, many rates stay the same. However, there will be some important changes. Here’s a rundown of the changes in the most commonly used rates and limits.

State Minimum Wage Changes*

State 2016
California $10.00
Connecticut $9.60
DC $11.50 eff. 7/1/16
Hawaii $8.50
Maryland $8.75
Massachusetts $10.00
Michigan $8.50
Nebraska $9.00
New York $9.00
Rhode Island $9.60
South Dakota $8.55
Vermont $9.60
West Virginia 8.75

*Only states with changes for 2016 are shown. All are effective 1/1/2016 except as noted.

State Unemployment Insurance Wage Base Changes*

State 2016
Colorado $12,200
Iowa $28,300
Kansas $14,000
Kentucky $10,200
Minnesota $31,000
Montana $30,500
Nevada $28,200
New Jersey $32,600
New York $10,700
North Carolina $22,300
Oklahoma $17,500
Pennsylvania $9,500
Vermont $16,800
Washington $44,000

*Only states with changes for 2016 are shown.

2016 Rates

Item
2015
2016
Social Security
$118,500
$118,500
 – FICA (6.2%)
$7,347.00
$7,347.00
 – Medicare (1.45%)
$200,000
$200,000
 – Medicare (2.35%)
 > $200,000
 > $200,000
     
Domestic Worker Threshold
$1,900
$2,000
     
Elections Workers
$1,600
$1,700
     
Transit Passes / Van Pool / Bike
$130 / $130 / $20
$130 / $130 / $20
     
Parking
$250
$255
     
415(b)(1)(A) Defined Benefit Max
$215,000
$215,000
     
Max Contribution
$53,000
$53,000
     
Education Assistance
$5,250
not released
     
Roth Limits
$183,000-$193,000 MAGI (joint)
$184,000-$194,000
 – 401(k)
$18,000
$18,000
 – 403(b)
$18,000
$18,000
 – 408(p)
$12,500
$12,500
     
414(v) Catch-Up
$6,000
$6,000
     
414(v) Catch-Up Simple
$3,000
$3,000
     
IRA
$5,500-6,500 < 50
$5,500-$6,500 > 50
     
Foreign Income Exclusion
$100,800
$101,300
     
Minimum Annual Comp 408
$600
$600
     
Adoption Exclusion Limits Tax Credit
$13,400
$13,460
 – Phase Out AGI
$201,010
$201,920
 – Total Exclusion AGI
$241,010
$241,920
     
Definition of Control Employee
$215,000 / $105,000
$215,000 / $105,000
 – Corp Officer
$105,000
$105,000
 – Earnings Test
$210,000
$210,000
     
Definition of Highly Comp.
$120,000
$120,000
 – Key Employee Top Heavy Plan
$170,000
$170,000
 – FSA
$2,550
$2,550
     
Long-Term Premiums    
 – < 40
$380
$380
 – 40-50
$710
$710
 – 50-60
$1,430
$1,430
 – 60-70
$3,800
$3,800
 – > 70
$4,750
$4,750
     
Limitations    
 – Highly Compensated 414
$120,000
$120,000
 – Annual Compensation Limits    
 – 414, 404, 408 SEP
$265,000
$265,000
 – Annual Compensation Limits    
 – 401 GVT plans in effect 7/1/93
$395,000
$395,000
 – FSA
$2,550
$2,550
     
HSA    
 – Annual Deduction Limit Single/Family
$1,300 / $,2600
$1,300 / $2,600
 – Maximum Out-of-Pocket Single/Family
$6,450 / $12,900
$6,550 / $13,100
 – Maximum Annual Contribution Single/Family
$3,350 / $6,650
$3,350 / $6,750
 – Maximum Annual Catch-Up (55)
$1,000
$1,000

 

Foreign Income Exclusions

Maximum Foreign Earned
Income Exclusion
Housing Limit
Base Housing
Max Foreign Cost Exclusion
2013
$97,600
$29,280
$15,616
$13,664
2014
$99,200
$29,760
$15,872
$13,888
2015
$100,800
$30,240
$16,128
$14,112
2016
$101,300
N/A
N/A
N/A
 
 
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James Paille CPP is the Director of Operations for Thomson Reuters myPay Solutions. He has been an executive manager in the payroll service industry for more than 30 years, specializing in managing multi-location offices. Jim is President-Elect of the American Payroll Association as well as a member of the National Speakers Bureau and chair of the CPP Certification Review Panel. He holds a Bachelor of Science in Accounting from St. John Fisher College in Rochester, NY.