2024 Year End Reminders and 2025 Payroll Tax Updates

By Rebecca Clemmer, Payroll Specialist

2024 Year End Reminders

Reporting of Fringe Benefits
If you have any fringe benefits that you’ve given your employees in 2024, they need to be included on their W-2’s. There are several items that qualify as fringe benefits. Below is a list of common items that you need to report, however this list is not all inclusive:

Health Insurance premiums you paid on behalf of a greater than 2% shareholder if you are an S Corporation
Personal Use of Company Car
Value of Group Term Life Insurance in excess of $50,000
Employer Health Savings Account Contributions
List of Retirement Plan Participants including Employer only contributions
Cash and Non-cash gifts given to employees, regardless of amount

These are only a few of the items that need to be included on the W-2’s.

Changes for 2025

2025 FICA Changes

The Social Security Wage Base is increasing to $176,100, therefore the maximum Social Security tax employees and employers will contribute is $10,918.20 each. Medicare continues to have no wage base limit. However, when an employee earns over $200,000, they will be subject to an extra .09% Medicare Tax. The employers do not match this portion of the Medicare tax.

Retirement Contribution Limits for 2025
401(k) $23,500
403(b) $23,500
Catch-up Contributions for 50 to 59 years old $7,500
Catch-up Contributions for 60 to 63 years old $11,250
Catch-up Contributions for 64 and older $7,500
Simple IRA or 401(k) $16,500
Catch-up Contributions for 50 to 59 years old $3,500
Catch-up Contributions for 60 to 63 years old $5,250
Catch-up Contributions for 64 and older $3,500

Health Savings Account Limits for 2025
Self-only Coverage $4,300
Family Coverage $8,550
Catch-up Contributions for over 55 years old $1,000
Health Flexible Spending Accounts $3,300

We hope this information will help you prepare for a productive and prosperous 2025. As always, you can contact DH Payroll at payroll@detweilerhershey.com for all of your payroll related issues.

Filed in: Client News, News