An array of tax-related limits that affect businesses are annually indexed for inflation, and many have increased for 2020. Here are some that may be important to you and your business.
\nSocial Security tax
\nThe amount of employees\u2019 earnings that are subject to Social Security tax is capped for 2020 at $137,700 (up from $132,900 for 2019).
\nDeductions
\nSection 179 expensing:
\nLimit: $1.04 million (up from $1.02 million for 2019)
\nPhaseout: $2.59 million (up from $2.55 million)
\nIncome-based phase-out for certain limits on the Sec. 199A qualified business income deduction begins at:
\nMarried filing jointly: $326,600 (up from $321,400)
\nMarried filing separately: $163,300 (up from $160,725)
\nOther filers: $163,300 (up from $160,700)
\nRetirement plans
\nEmployee contributions to 401(k) plans: $19,500 (up from $19,000)
\nCatch-up contributions to 401(k) plans: $6,500 (up from $6,000)
\nEmployee contributions to SIMPLEs: $13,500 (up from $13,000)
\nCatch-up contributions to SIMPLEs: $3,000 (no change)
\nCombined employer\/employee contributions to defined contribution plans (not including catch-ups): $57,000 (up from $56,000)
\nMaximum compensation used to determine contributions: $285,000 (up from $280,000)
\nAnnual benefit for defined benefit plans: $230,000 (up from $225,000)
\nCompensation defining a highly compensated employee: $130,000 (up from $125,000)
\nCompensation defining a \u201ckey\u201d employee: $185,000 (up from $180,000)
\nOther employee benefits
\nQualified transportation fringe-benefits employee income exclusion: $270 per month (up from $265)
\nHealth Savings Account contributions:
\nIndividual coverage: $3,550 (up from $3,500)
\nFamily coverage: $7,100 (up from $7,000)
\nCatch-up contribution: $1,000 (no change)
\nFlexible Spending Account contributions:
\nHealth care: $2,750 (up from $2,700)
\nDependent care: $5,000 (no change)
\nThese are only some of the tax limits that may affect your business and additional rules may apply. If you have questions, please contact us.
\n\u00a9 2019<\/p>\n","protected":false},"excerpt":{"rendered":"
An array of tax-related limits that affect businesses are annually indexed for inflation, and many have increased for 2020. Here are some that may be important to you and your business. Social Security tax The amount of employees\u2019 earnings that are subject to Social Security tax is capped for 2020 at $137,700 (up from $132,900 […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[],"class_list":["post-14414","post","type-post","status-publish","format-standard","hentry","category-small-business"],"_links":{"self":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/14414","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/comments?post=14414"}],"version-history":[{"count":0,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/posts\/14414\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/media?parent=14414"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/categories?post=14414"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sfw.cpa\/news-and-guides\/wp-json\/wp\/v2\/tags?post=14414"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}