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2021 Wage Cap Rises for Social Security Payroll Taxes

On October 13, the Social Security Administration (SSA) announced, starting January 1, 2021, the maximum earnings subject to the Social Security payroll tax will increase by $5,100 to$142,800 up from the $137,700 maximum for 2020. The SSA also posted a fact sheet summarizing the 2021 changes.

Next Steps for Employers

Employers should notify affected employees and ensure that their payroll systems are setup to account for the higher taxable wage base for Social Security payroll tax.

HR Works, headquartered in Upstate New York, is a human resource management outsourcing and consulting firm serving clients throughout the United States for over thirty years. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.