As 2014 comes to an end and 2015 beginning, there are a few changes in store for employers and employees. The base earnings for Federal Insurance Contributions Act (FICA) and State Disability Insurance (SDI) are going up. You can see the changes on the chart below. Employees will see a slight increase in their pay checks in 2015 as the SDI rate is going from 1% to .9%. The contribution for 401K has also increased to $18,000 for 2015 with the catch up contribution going to $6,000. This is a great time to think of saving plans for your future.
|CA SDI Max||$101,636||$104,378|
Watch this friendly video about some of the changes that might effect you.
Employers also need to be very aware of mileage reimbursement for its employees. The IRS standard for reimbursement is 56 cents for each mile driven for business purposes. The IRS figures this amount out as it covers for gas and wear and tear on the employee’s car. If an employer pays less that the IRS standard, then the employee can come back to its employer and try to demand money for repairs like new brakes or tires. Make sure the employee documents their mileage as well so they can be reimbursed properly.
These are just a few of the changes to be aware of in 2015. At MMC, we will always try to provide the most updated news and content but it is always a good idea to research any legal changes for your own knowledge. As always, if you have any questions, please feel free to contact the MMC payroll department. From the MMC payroll team, we wish you a Happy Holiday Season!