IRS Announcement: 2020 Qualified Pension Plan Limits

The Internal Revenue Service recently announced cost-of-living and statutory dollar limitation for qualified pension plans for 2020.  Some of the changes are listed below.

Social Security Facts

The combined tax rate for Social Security and Medicare for an employee is 7.65%.  The Social Security portion (OASDI) is 6.20% on earnings up to the applicable taxable maximum amount.

The Medicare portion (HI) is 1.45% on all earnings.  There is an additional 0.9% Medicare tax on all earnings above certain threshold amounts ($250,000 in wages for married filing jointly and $200,000 for single taxpayers). These thresholds are not indexed for inflation. For a married couple, filing a joint return, the additional 0.9% tax is on the combined earnings of the employee and the employee’s spouse.

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Through a powerful combination of independence and experience, Mullin Barens Sanford Financial and Insurance Services (MBS Financial) is a leading consulting firm that assists companies with 409A and other executive benefit needs.

Disclaimer: The materials are designed to convey accurate and authoritative information concerning the subject matter covered. However, they are provided with the understanding that Mullin Barens Sanford does not engage in the practice of law, or give tax, legal or accounting advice. For advice in these areas please consult your appropriate advisors.

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