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2023 Wage Cap Rises for Social Security Payroll Taxes

On October 13, the Social Security Administration (SSA) announced that approximately 70 million Americans will see an 8.7 percent increase in their Social Security benefits and Supplemental Security Income (SSI) payments in 2023. On average, Social Security benefits will increase by more than $140 per month starting in January.

Starting January 1, 2023, the maximum earnings subject to the Social Security payroll tax will increase to $160,200, up from the $147,000 maximum for 2022. The SSA also posted a fact sheet summarizing the 2023 cost-of-living adjustments (COLAs).

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, Inc., headquartered at 200 WillowBrook Office Park in Fairport (Rochester), New York, with an office in East Syracuse, is a human resource management outsourcing and consulting firm serving clients throughout the United States. 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.