Public Announcements
Tax Reform Legislation Will Affect Payroll
On December 22, President Trump signed H.R. 1, also known as the Tax Cuts and Jobs Act, into law. The legislation, which marks the most sweeping tax changes in 30 years, will affect payroll professionals by changing the taxability of two fringe benefits and affecting income tax withholding in 2018 and beyond. Because this tax legislation was passed so late in 2017, the IRS will not issue withholding guidance for 2018 until January.
Internal Revenue Bulletin No. 2018–10, released March 5, clarified that:
- For HSAs, the annual tax-deductible contribution limit for tax year 2018 will stay at $3,450 for HSA account holders with self-only coverage through a high-deductible health plan but has been lowered to $6,850 for account holders with family coverage through a high-deductible plan.
- The maximum amount that can be excluded from an employee's gross income for qualified adoption expenses is reduced to $13,810 from $13,840. The adjusted gross income threshold for phase out is reduced to $207,140 from $207,580.
- Health care flexible spending accounts (FSAs), transit and other benefit limits now linked to the chained CPI were not affected for 2018.
Early Due Dates for W-2, W-3 and Form 1099-MISC
Employers face a January 31, 2018, due date for filing 2017 Forms W-2 and W-3 with the Social Security Administration. This date applies to both electronic and paper filers.
Form 1099-MISC is due to the IRS and individuals by January 31 when reporting non-employee compensation payments in box 7.
IRS Extends Due Date for Employers and Providers to Issue Health Coverage Forms to Individuals in 2018
Notice 2018-06 Insurers, self-insuring employers, other coverage providers, and applicable large employers now have until March 2, 2018, to provide Forms 1095-B or 1095-C to individuals, which is a 30-day extension from the original due date of Jan. 31. This 30-day extension is automatic. The due dates for filing 2017 information returns with the IRS are not extended. For 2018, the due dates to file information returns with the IRS are:
- Feb. 28 for paper filers
- April 2 for electronic filers
IR-2018-36 - Updated Withholding Calculator, Form W-4 Released Feb 28th, 2018
The Internal Revenue Service released an updated Withholding Calculator on IRS.gov and a new version of Form W-4 to help taxpayers check their 2018 tax withholding following passage of the Tax Cuts and Jobs Act in December.
IRS LIMIT ANNOUNCEMENTS:
SOCIAL SECURITY LIMIT: $128,400
401K MAXIMUM: $18,500 - Total Comp = $275,000
401K CATCH-UP: $6,000 for a total of $24,500
BUSINESS MILEAGE: 54.5 cents
MOVING/MEDICAL: 18 cents
CHARITABLE: 14 cents
HEALTH SAVINGS ACCOUNT: $3,450 FOR INDIVIDUAL AND $6,850 FOR FAMILY
HEALTH SAVINGS ACCOUNT CATCH-UP: $1,000
HEALTH CARE FLEXIBLE SPENDING ACCOUNT LIMIT: $2,650
DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT LIMIT: $5,000 FOR MARRIED JOINT RETURNS AND $2,500 FOR MARRIED FILING SEPARATE RETURNS
TRANSIT PASSES: $260 PER MONTH
TRANSIT PARKING: $260 PER MONTH
ADOPTION ASSISTANCE: $13,810
