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US employment tax rates

and limits for 2014


Revised January 2014

Contents
Social Security wage base to increase for 2014

Qualified pension plan limits for 2014

Federal mileage rates

Fringe-benefit inflation adjustments for 2014

Per diem rates under high-low substantiation


method for 2014

2013 FUTA credit reduction states

State unemployment insurance


wage base limits for 2014

Federal income tax withholding tables


for 2014

10

Supplemental income tax withholding rates


for 2014

12

States with revised income tax withholding


tables in 2014

14

Social Security wage base


to increase for 2014
The Social Security wage base will increase from $113,700 to $117,000 in 2014, higher
thanthe $115,500 projected in the May 2013 Annual Report of The Board of Trustees.
The increase in the wage base of $3,300 is estimated to result in higher taxes for about
10million workers.
The Medicare tax rate for 2014 remains at 1.45% of all covered earnings for employers
andemployees.
Effective in 2013, the Additional Medicare Tax of 0.9% applies to earned income of more
than$200,000 ($250,000 for married couples filing jointly). Employers withhold this tax
onwages in excess of $200,000 regardless of an employees filing status.
See below for a quick reference chart.

Social Security, Medicare and disability insurance contributions


2014 compared with 2013
Description

2014

2013

Increase

Social Security tax


ratefor employees

6.20%

6.20%

-0-

Social Security tax


ratefor employers

6.20%

6.20%

-0-

Social Security
wagebase

$117,000

$113,7000

$3,300

Maximum Social
Security tax for
employees

$7,254.00

$7,049.40

$204.60

Medicare tax rate


foremployers

1.45%

1.45%

-0-

Medicare tax rate


foremployees

1.45%*

1.45%

-0-

Medicare wage base

No limit

No limit

N/A

* Employers must withhold an additional Medicare tax of 0.9% of wages in excess of $200,000. There is no employer
matching contribution.

For the complete Social Security Administration fact sheet go here.


For related information see our special report here.

US employment tax rates and limits for 2014 Preliminary |

Qualified pension plan


limits for 2014
IRS releases the qualified
retirement plan limitations
for year 2014
The dollar limitations for qualified retirement
and certain nonqualified plans that become
effective January 1, 2014, were released by
the IRS (see IR-2013-86 at www.irs.gov).
The dollar limitations that are adjusted by
reference to IRC 415(d) are adjusted for
inflation, and consequently many of the
pension plan limitations will change for 2014
because the increase in the cost-of-living
index met the statutory thresholds that
trigger their adjustments. Plan participants
in qualified retirement plans will need to
consider the impact of the 2014 dollar
limitations in their overall financial planning.
The pretax limit that applies to elective
deferrals to 401(k), 403(b) and most 457(b)
plans remains at $17,500. The dollar
limitation for catch-up contributions for
participants age 50 or over also remains
unchanged at $5,500.
A complete summary of the cost-of-living
adjustments applicable to dollar limitations
for qualified retirement plans and other items
for 2014 is is provided on the right.

Qualified retirement plan limitations (2013 vs. 2014)


Description

2013 limit

2014 limit

Participant pretax contribution limit for 401(k)


and 403(b) plans

$17,500

$17,500

$17,500

$17,500

$5,500

$5,500

$2,500

$2,500

Lesser of $205,000
or 100% of the
participants three-yearhigh compensation

Lesser of $210,000
or 100% of the
participants three-yearhigh compensation

Lesser of $51,000
or 100% of the
participants
compensation

Lesser of $52,000
or 100% of the
participants
compensation

$1,035,000/$205,000

$1,050,000/$210,000

$115,000

$115,000

$165,000

$170,000

$255,000

$260,000

$550

$550

$12,000

$12,000

$100,000/$205,000

$105,000/$210,000

Section 402(g)(1)
Deferral limit for deferred compensation plans of
state and local governments and tax-exempts
Section 457(e)(15)
Dollar limitation for catch-up contributions for
participants age 50 or over in 401(k), 403(b),
governmental 457 plans and SEPs
Section 414(v)(2)(B)(i)
Dollar limitation for catch-up contributions for
participants age 50 or over to a SIMPLE IRA or a
SIMPLE 401(k)
Section 414(v)(2)(B)(ii)
Defined benefit plan limit1
Section 415(b)(1)(A)
Defined contribution plan limit
Section 415(c)(1)(A)
Maximum ESOP account balance is subject to
a five-year distribution period/increments for
additional year
Section 409(o)(1)(C)(ii)
Highly-compensated-employee dollar threshold
Section 414(q)(1)(B)
Definition of key employee in a top-heavy plan
officer compensation threshold
Section 416(i)(1)(A)(i)
Annual limit on includable compensation for
benefits and allocations2

Footnotes
1 For a participant who separated from service before

January 1, 2014, the participants limitation under


a defined benefit plan under IRC 415(b)(1)(B) is
computed by multiplying the participants compensation
limitation, as adjusted through 2013, by 1.0155.

2 For eligible participants in certain governmental

plans that allow cost-of-living adjustments to the


compensation limit to be taken into account, such a limit
increases from $380,000 to $385,000.

Sections 401(a)(17), 404(l), 408(k)(3)(C) and


408(k)(6)(D)(ii)
SEP employee participation floor
Section 408(k)(2)(C)
SIMPLE retirement accounts contribution limit
Section 408(p)(2)(E)
Compensation amount of control employees for
fringe-benefit valuation purposes
Treas. Reg. Section 1.61-21(f)(5)(i) and (iii)

| US employment tax rates and limits for 2014 Preliminary

Federal 2014 mileage rates

Effective January 1, 2014, the business standard mileage rate (including


vans, pickup trucks and panel trucks) decreases from $0.565 per mile to
$0.560, and the medical and relocation rate also decreases from $0.240
per mile to $0.235. Mileage related to charity is set by law and remains at
$0.140 per mile. (IRS Notice 2013-80.)
Note that the business standard mileage rate may not be used (1) after using any depreciation
method under the Modified Accelerated Cost Recovery System (MACRS), (2) after claiming an
IRC 179 deduction for that vehicle, or (3) for more than four vehicles used simultaneously.
(Rev. Proc. 2010-51)

Summary of mileage rates 2013 compared with 2014


Type of mileage

Effective January 1, 2013

Effective January 1, 2014

Business standard

$0.565

$0.560

Charity

$0.140

$0.140

Relocation and medical

$0.240

$0.235

US employment tax rates and limits for 2014 Preliminary |

Fringe-benefit inflation
adjustments for 2014
In Revenue Procedure 2013-35, the IRS published the inflation adjustments that will apply to
various fringe benefits in 2014.

2014 medical savings account (MSA) limits


Summarized below are the 2014 limits that apply to MSAs.
Provision

Self-only coverage

Family coverage

Annual deductible as defined in


IRC 220(c)(2)(A)

Not less than $2,200 and not


more than $3,250

Not less than $4,350 and not


more than $6,550

Annual out-of-pocket (other than


for premiums)

Not to exceed $4,350

Not to exceed $8,000

Adoption assistance
The limit on qualified adoption assistance for 2014 is $13,190, up from $12,970 in 2013.

Health flexible spending accounts


The 2014 annual limit on the amount of pretax contributions employees can make
towardtheir health flexible spending account under a cafeteria plan is $2,500,
unchangedfrom 2013.

Transportation fringe benefits


The 2014 monthly limit on parking benefits is $250, up from $245 in 2013.
The 2014 aggregate monthly limit for transportation in a commuter highway vehicle and
anytransit pass is $130, down from $245 in 2013.
Note that should Congress extend the provision that gives parity between parking and
commuter benefits, the 2014 limit would be adjusted to $250.

| US employment tax rates and limits for 2014 Preliminary

Per diem rates under high-low


substantiation method for 2014
In Notice 2013-65, the IRS released the per diem
reimbursement rates that will apply effective
October1,2013 (or, optionally, January1, 2014).
The per diem reimbursement rate for high-cost areas
increases to $251 and to $170 for low-cost areas. There
were also a number of changes to the areas that qualify
as high cost.

High-cost localities of travel under the high-low


substantiation method (effective October 1, 2013)
Key city

County/other defined location

Arizona
Sedona
(March 1April 30)

City limits of Sedona

California

The per diem rates for each locality of travel both within and outside
of the United States can be found at www.gsa.gov.

Monterey
(July 1Aug. 31)

Monterey

Federal per diem rates under the high-low


substantiation method for 2014

Napa
(Oct. 1Nov. 30; April 1Sept.30)

Napa

San Diego

San Diego

High-cost area*

Low-cost area

San Francisco

San Francisco

$251

$170

Santa Barbara

Santa Barbara

$181

$113

Santa Cruz

Meals and incidentals only

$65

$52

Santa Cruz
(June 1Aug. 31)

Incidental expenses only**

$5

$5

Santa Monica

City limits of Santa Monica

Yosemite National Park


(June 1Aug. 31)

Mariposa

Description
Lodging, meals and incidentals
Lodging only

*For high-cost areas, see the table at the right.


**Rate applies only when a meal expense allowance is not provided.

Colorado
Aspen
(Dec. 1March 31; June 1Aug. 31)

Pitkin

Denver/Aurora

Denver, Adams, Arapahoe and


Jefferson

Steamboat Springs
(Dec. 1March 31)

Routt

Telluride
(Dec. 1March 31; June 1Sept. 30)

San Miguel

Vail
(Dec. 1Aug. 31)

Eagle

District of Columbia
Washington, DC

Also the cities of Alexandra, Falls


Church and Fairfax and the counties
of Arlington and Fairfax in Virginia,
and the counties of Montgomery
and Prince Georges in Maryland
(see also Maryland and Virginia)

US employment tax rates and limits for 2014 Preliminary |

Per diem rates under high-low


substantiation method for 2014
Continued

Key city

County/other defined location

Key city

County/other defined location

Florida

New York

Boca Raton/Delray Beach/Jupiter


(Jan. 1April 30)

Floral Park, Garden City and


Great Neck

Nassau

Fort Lauderdale
(Jan. 1May 31)

Broward

Glens Falls
(July 1Aug. 31)

Warren

Fort Walton Beach/DeFuniak Springs


(June 1July 31)

Okaloosa and Walton

Lake Placid
(July 1Aug. 31)

Essex

Key West

Monroe

Miami
(Dec. 1March 31)

Miami-Dade

Manhattan (includes boroughs


of Manhattan, Brooklyn,
the Bronx, Queens, Staten Island)

Bronx, Kings, New York, Queens,


Richmond

Naples
(Jan. 1April 30)

Collier

Saratoga Springs/Schenectady
(July 1Aug. 31)

Saratoga and Schenectady

Tarrytown/White Plains/New Rochelle

Westchester

Illinois
Chicago
(Oct. 1Nov. 30; March 1Sept. 30)

Cook and Lake

Louisiana
New Orleans
(Oct. 1June 30)

Orleans, St. Bernard, Jefferson


and Plaquemine parishes

Kill Devil
(June 1Aug. 31)

Hancock

Pennsylvania
Philadelphia
Jamestown, Middletown and Newport
(Oct. 1Oct. 31; May 1Sept. 30)

Baltimore City
(Oct. 1Nov. 30; March 1Sept. 30)

Baltimore City

Charleston
(May 1May 31)

Cambridge/St. Michaels
(June 1Aug. 31)

Dorchester and Talbot

Texas

Ocean City
(June 1Aug. 31)

Worcester

Washington, DC, metro area

Montgomery and Prince Georges

Massachusetts
Boston/Cambridge

Suffolk, City of Cambridge

Falmouth
(July 1Aug. 31)

City limits of Falmouth

Marthas Vineyard
(June 1Aug. 31)
Nantucket
(June 1Sept. 30)

Newport

Charleston, Berkeley and


Dorchester

Midland
Utah
Park City
(Dec. 1March 31)

Summit

Virginia
Washington, DC, metro area

Cities of Alexandria, Fairfax and


Falls Church; counties of Arlington
and Fairfax

Dukes

Virginia Beach
(June 1Aug. 31)

City of Virginia Beach

Nantucket

Washington
Seattle

New Hampshire

Philadelphia

South Carolina

Maryland

Conway
(July 1Aug. 31)

Dare

Rhode Island

Maine
Bar Harbor
(July 1Aug. 31)

North Carolina

Carroll

| US employment tax rates and limits for 2014 Preliminary

King

Wyoming
Jackson/Pinedale
(July 1Aug. 31)

Teton and Sublette

2013 FUTA credit reduction states

The U.S. Department of Labor announced today that employers in


13 states and the Virgin Islands will pay their FUTA taxes for calendar
year 2013 at a higher federal unemployment (FUTA) tax rate than
employers in other states because the states failed to repay their
outstanding federal UI loans by November 10, 2013. (This is down
from the 18 states and the Virgin Islands that had credit reductions
for calendar year 2012.) The increased 2013 FUTA taxes are due
from employers with their fourth quarter 2013 federal unemployment
tax deposit, due January 31, 2014. (States with 2013 Federal
Unemployment Tax Act (FUTA) credit reductions, U.S. Department of
Labor, November 12, 2013.)
State

Credit reduction

2013 net FUTA rate

Arkansas

0.9%

1.5%

California

0.9%

1.5%

Connecticut

0.9%

1.5%

Delaware

0.6%

1.2%

Georgia

0.9%

1.5%

Indiana

1.2%

1.8%

Kentucky

0.9%

1.5%

Missouri

0.9%

1.5%

New York

0.9%

1.5%

North Carolina

0.9%

1.5%

Ohio

0.9%

1.5%

Rhode Island

0.9%

1.5%

Virgin Islands

1.2%

1.8%

Wisconsin

0.9%

1.5%

Details
The Social Security Act requires a reduction in the FUTA tax credit
when a state has outstanding federal loans for on January 1 of two
consecutive years. The reduction in the FUTA tax credit is 0.3% for the
firstyear and an additional 0.3% (or more) for each succeeding year
until the loan is repaid.
Employers in Indiana will see a 1.2% FUTA credit reduction for
2013because this is the fourth penalty year. Indiana employers
potentially faced an even higher FUTA cost this year because the
state has carried its federal loans for five years however, the state
requested, and received, a waiver of the additional benefit cost
reduction (BCR) factor.

Virgin Islands employers again face the special 2.7 add-on FUTA
penalty that applied in 2012 because of having an average state UI
rate that is lower than allowed under federal law. However, the penalty
is lower for 2013, and the net FUTA rate that Virgin Islands employers
will pay at is 0.3% less than 2012.
Georgia requested that its FUTA credit reduction be capped for 2013
at the 2012 level; however, according to a U.S. Department of Labor
official, the state did not qualify for the cap. As a result, Georgia joins
the other states than began borrowing in 2009 in having a net FUTA
rate of 1.5%.
For the third year in a row, South Carolina requested, and received,
avoidance of the FUTA credit reduction for 2013. South Carolina
(and Indiana) employers potentially faced the addition of the BCR
factor because the state has carried its federal loans for five years
however, the state requested, and received, a waiver of the additional
penalty. As a result, although the state still has an outstanding loan
balance, South Carolina employers will pay at the minimum net FUTA
rate of 0.6% for 2013.
Legislation enacted earlier this year (HB 168) allows the Delaware
Department of Labor the option to repay its loan by borrowing
funds from the states general fund or other state fund; however, the
Department did not do so by the November 10, 2013, deadline. As
a result, Delaware employers will pay their 2013 FUTA taxes at a net
rate of 1.2%.
Arizona, Florida, Nevada, New Jersey and Vermont all repaid
their federal loans during 2013, reducing the net FUTA rate to the
minimum 0.6%. Several did so through the issuance of bonds, which
may result in state assessments to employers to repay the bonds
rather than increased FUTA taxes.

2013 Form 940 and Schedule A


shouldsoon be released
The final version of the 2013 Form 940, Employers Annual Federal
Unemployment (FUTA) Tax Return, and Form 940, Schedule A, Multistate Employer and Credit Reduction Information, should soon be
released by the Internal Revenue Service.
For more information on FUTA taxes, see the US Department of
Labors website or contact Debera Salam at debera.salam@ey.com.

US employment tax rates and limits for 2014 Preliminary |

2014 state unemployment


taxable wage bases
Here is the final list of the 2014 state unemployment insurance (SUI) taxable wage bases and
employee SUI withholding rates, if applicable.

SUI taxable wage bases, 2014 vs. 2013


State
Alabama
Alaska
Arizona
Arkansas
California

8,000*
37,400

2013
36,900

7,000*

7,000*

12,000*

12,000*

7,000*

% increase/
decrease
1.36%

11,300

Connecticut

15,000*

15,000*

Delaware8

18,500

10,500*

District of Columbia

9,000*

9,000*

Florida

8,000*

8,000*

Georgia

9,500*

9,500*

3.54%
76.20%

Hawaii

40,400

39,600

2.02%

Idaho

35,200

34,800

1.15%

Illinois

12,960

12,900

0.47%

Kansas7

9,500*
26,800
8,000*

9,500*
26,000

9,600

9,300

Louisiana

7,700

7,700

12,000*

12,000*

8,500*

8,500*

14,000*

14,000*

Maryland
Massachusetts
Michigan

9,500*
29,000

29,000

Mississippi

14,000*

14,000*

Missouri

13,000*

13,000*

Montana

29,000

27,900

9,000*

3.94%

9,000*

Nevada

27,400

26,900

New Hampshire

14,000*

14,000*

New Jersey

31,500

30,900

| US employment tax rates and limits for 2014 Preliminary

3.23%

9,500*

Minnesota

Nebraska

3.08%

8,000*

Kentucky1
Maine

0.62%

7,000*

11,700

Indiana

2014 employee
contributionrates

8,000*

Colorado

Iowa

2014

1.86%
1.94%

Employee SUI withholding


rate is 0.425% on wages up
to $31,5005

State

2014

2013

% increase/
decrease

New Mexico

23,400

22,900

2.18%

New York

10,300

8,500

21.18%

North Carolina

21,400

20,900

2.39%

North Dakota

33,600

31,800

5.66%

Ohio

9,000*
18,700

20,100

(7.49%)

Oregon

35,000

34,100

2.64%

Pennsylvania

8,7504

8,5004

2.94%

Rhode Island
South

Carolina2

South Dakota3
Tennessee
Texas

7,000*

7,000*

20,6006

20,2006

12,000

12,000

14,000

13,000

9,000*
9,000*

7.69%

9,000*
9,000*

Utah

30,800

30,300

Vermont

16,000*

16,000*

8,000*

8,000*

Virginia

1.98%

1.65%

Virgin Islands

22,500

23,600

(4.88%)

Washington

41,300

39,800

3.77%

West Virginia

12,000*

12,000*

Wisconsin

14,000

14,000

Wyoming

24,500

23,800

FUTA

7,000*

2.94%

7,000*

* Law sets the taxable wage base; legislation would be necessary to change.

Footnotes:
1
Kentucky. The taxable wage base will
continue to increase by $300 each calendar
year until the taxable wage base reaches
$12,000 in 2022.
2
South Carolina. The taxable wage base will
increase to $14,000 for 2015.
3
South Dakota. The taxable wage base will
increase by $1,000 per year through 2015:
2010 = $10,000; 2011=$11,000; 2012
= $12,000; 2013 = $13,000; 2014 =
$14,000; 2015 = $15,000.

9,000*

Oklahoma

Puerto Rico

2014 employee
contributionrates

Employee SUI withholding


0.07% on total wages

4
Pennsylvania. The taxable wage base will
increase to $9,000 for calendar year 2015,
$9,500 for calendar year 2016, $9,750
for calendar year 2017, and $10,000 for
calendar year 2018 and after.
5
New Jersey. Employee rate includes the
Workforce Development/Supplemental
Workforce Funds surcharge.
6
Rhode Island. Employers assigned
the maximum tax rate of 9.79% pay
unemployment taxes up to a taxable wage
base of $22,100 for 2014.
7
Kansas. The taxable wage base will increase
to $12,000 in 2015 and to $14,000 in
2016.
8
Delaware. Legislation enacted in mid-August
2013 changesthe determination of the SUI
taxable wage base from a set amount of
$10,500 to a range of $10,500 to $18,500
for calendar year 2014 and beyond by tying
the wage limit to the balance of the states
unemployment trust fund the higher the
trust fund balance, the lower the taxable
wage base.

US employment tax rates and limits for 2014 Preliminary |

Federal withholding rates for 2014

The IRS has released the 2014 Publication 15,


CircularE, Employers Tax Guide. Here is what you need
to know about withholding federal tax from wages.

Nonresident alien employee


income tax calculation

As previously reported, the 2014 Social Security wage base increases


to $117,000.

For 2014, apply the following procedure to figure the amount of


federal income tax to withhold from the wages of nonresident alien
employees performing services within the US. Use the chart below in
addition to the withholding tables used to figure federal income tax
withholding on the wages of nonresident alien employees.

The Social Security and Medicare tax rates for both the employer and
the employee remain unchanged, at 6.2% and 1.45%, respectively.

Note: Nonresident alien students from India and business apprentices


from India are not subject to this procedure.

Also unchanged is the Additional Medicare Tax. Employers are


required to withhold Additional Medicare Tax of 0.9% on wages in
excess of $200,000. There is no employer contribution.

Amount to add to nonresident alien employees wages


for calculating 2014 income tax withholding only

Social Security and Medicare tax

For our guide to the 2014 federal and state rates and limits, go to our
year-end resource hub here.

Payroll period

Add additional

Daily or miscellaneous

$8.70

Weekly

$43.30

Biweekly

$86.50

Semimonthly

$93.80

Monthly

$187.50

Quarterly

$562.50

Semiannually

$1,125.00

Annually

$2,250.00

2014 annual percentage


method withholding
The following is a reprint of the tax year 2014 annual percentage
method of federal income tax withholding.

Withholding allowances
Payroll period
Daily or miscellaneous
Weekly

10 | US employment tax rates and limits for 2014 Preliminary

One withholding allowance


$15.20
$76.00

Biweekly

$151.90

Semimonthly

$164.60

Monthly

$329.20

Quarterly

$987.50

Semiannually

$1,975.00

Annually

$3,950.00

Table 7 Annual payroll period


(a) Single person (including head of household)
If the amount of wages (after
subtracting withholding allowances) is:

The amount of income tax to withhold is:

Not over $2,250

$-0-

Over

But not over

Of excess over

$2,250

$11,325

$0.00 + 10.0%

$2,250

$11,325

$39,150

$907.50 + 15.0%

$11,325

$39,150

$91,600

$5,081.25 + 25.0%

$39,150

$91,600

$188,600

$18,193.75 + 28.0%

$91,600

$188,600

$407,350

$45,353.75 + 33.0%

$188,600

$407,350

$409,000

$117,541.25 + 35.0%

$407,350

$409,000

And over

$118,118.75 + 39.6%

$409,000

(b) Married person


If the amount of wages (after
subtracting withholding allowances) is:

The amount of income tax to withhold is:

Not over $8,450

$-0-

Over

But not over


$8,450

$26,600

$26,600

$82,250

Of excess over

$0.00 + 10.0%

$8,450

$1,815.00 + 15.0%

$26,600

$82,250

$157,300

$10,162.50 + 25.0%

$82,250

$157,300

$235,300

$28,925.00 + 28.0%

$157,300

$235,300

$413,550

$50,765.00 + 33.0%

$235,300

$413,550

$466,050

$109,587.50 + 35.0%

$413,550

$466,050

And over

$127,962.50 + 39.6%

$466,050

US employment tax rates and limits for 2014 Preliminary | 11

State supplemental income tax


withholding rates for 2014
Comparable to the optional flat
rate of 25% (for 2013 and 2014)
that can be used for computing
federal income tax withholding
on supplemental wages such as
bonuses, some states also allow for
a fixed supplemental rate of income
tax withholding.
Following is our 2014 survey of states
that allow for the optional use of the
supplemental withholding method and the
rates that apply for 2014. Changes since our
2013 survey are highlighted in yellow.
(Much of this information was obtained by
Ernst & Young LLP during the course of
informal telephone or email surveys with
state governmental agencies. Although
telephone and email surveys are useful in
determining how government departments
currently treat an issue, answers and
positions derived from such surveys are not
binding upon the state, cannot be cited as
precedent and may change over time and
hence cannot be relied upon.)

Ernst & Young LLP survey


States offering a supplemental withholding tax rate option*
(as of January 7, 2014)
Changes between the 2013 and 2014 survey are highlighted in yellow
State supplemental withholding tax rate options for 2014
State

State contact number

Supplemental withholding
taxrate for 2014

Alabama

+1 334 242 1300

5.00%

Arkansas

+1 501 682 7290

7.00%

+1 916 464 3502 or


+1888745 3886

6.60%

California
Supplemental wages
Bonus and stock options

10.23%

Colorado

+1 303 238 7378

Georgia

+1 877 423 6711

4.63%

Annual wages: under $8,000

2.00%

$8,000$10,000

3.00%

$10,000$12,000

4.00%

$12,000$15,000

5.00%

Over $15,000

6.00%

Idaho

+1 208 334 7660

7.40%

Illinois

+1 217 782 3336

5.00%

Indiana

+1 317 232 2337

3.40%

Iowa

+1 515 281 3114

6.00%

Kansas

+1 785 368 8222

4.50%

Maine

+1 207 626 8475

5.00%

Maryland (1)

+1 410 260 7980

MD resident 5.75% plus local


WH rate

Massachusetts

+1 617 887 6367

5.20%

Michigan

+1 517 636 4730

4.25%

Minnesota

+1 651 282 9999

6.25%

Missouri

+1 573 751 3505

6.00%

Montana

+1 406 444 6900

6.00%

Nebraska

+1 402 471 5729

5.00%

New Mexico

+1 505 827 0700

4.90%

New York (2)

+1 518 485 6654

9.62%

North Carolina

+1 877 252 3052

5.80%

North Dakota

+1 701 328 1248

2.28%

Ohio

+1 888 405 4089

3.50%

12 | US employment tax rates and limits for 2014 Preliminary

State supplemental withholding tax rate options for 2014


State

State contact number

Supplemental withholding
taxrate for 2014

Oklahoma

+1 405 521 3160

5.25%

Oregon

+1 503 378 4988

9.00%

Pennsylvania

+1 717 787 1064

3.07%

Rhode Island

+1 401 574 8829

5.99%
7.00%

South Carolina

+1 803 896 1450

Vermont (3)

+1 802 828 2551

24% of federal withholding

Virginia

+1 804 367 8037

5.75%

West Virginia

+1 304 558 3333

Annual wages: under $10,000

3.00%

$10,000$24,999

4.00%

$25,000$39,999

4.50%

$40,000$60,000

6.00%

Over $60,000
Wisconsin

6.50%
+1 608 266 2776

Annual wages: under $10,220

4.60%

$10,220$20,439

6.15%

$20,440$153,279

6.50%

$153,280$224,999

6.75%

$225,000 and over

7.75%

* There is no supplemental rate of withholding for Arizona, Connecticut, Delaware, District of Columbia, Hawaii, Kentucky,
Louisiana, Mississippi, New Jersey, Puerto Rico or Utah.

Footnotes
(1) Maryland: For lump-sum distributions, withhold at 7.0% for nonresidents, 3.20% for residents
employed in Delaware, and 5.75% plus local rate for residents working in Maryland.
(2) New York: For state withholding tax purposes, the supplemental withholding rate is 9.62%. For
NewYork City residents, the supplemental withholding rate is 4.25%. For City of Yonkers, the
resident supplemental withholding rate is 1.443%, and for nonresidents, 0.50%.
(3) Vermont: According to the Department of Taxes 2013 income tax withholding booklet

and Publication TB 23 (revised January 2013), the supplemental withholding rate was
27% of the federal withholding amount for supplemental and nonperiodic payments.

US employment tax rates and limits for 2014 Preliminary | 13

States with 2014 revised


incometax withholding tables
The following chart summarizes the states that have issued revised income tax withholding tax tables and/or
instruction guides for tax year 2014. If you do not have a copy of the states revised income tax withholding guide for
tax year 2014, see the link in the chart below.
For more tips on items to watch out for as we begin a new year, see the EY 2013 payroll checklist here.
(Much of this information was obtained by Ernst & Young LLP during the course of informal telephone or email surveys with state governmental
agencies. Although telephone and email surveys are useful in determining how government departments currently treat an issue, answers and
positions derived from such surveys are not binding upon the state, cannot be cited as precedent and may change over time and hence cannot
be relied upon.)

States with revisions to their 2014 income tax withholding tables


State

Website

California

http://www.edd.ca.gov/Payroll_Taxes/Rates_and_Withholding.htm

Connecticut

http://www.ct.gov/drs/lib/drs/forms/2014withholding/2014_withholding_tables.pdf

Delaware

http://revenue.delaware.gov/services/wit_folder/section17.shtml

District of Columbia

http://otr.cfo.dc.gov/sites/default/files/dc/sites/otr/publication/attachments/46912_FR-230-122013.pdf

Indiana

http://www.in.gov/dor/files/dn01.pdf

Kansas

http://www.ksrevenue.org/pdf/kw1002014.pdf

Kentucky

http://revenue.ky.gov/NR/rdonlyres/6278107A-D950-4C09-B4ED-B156C922BA8E/0/7_201442A003T.pdf

Maine

http://www.maine.gov/revenue/forms/with/2014/14_whtables.pdf

Maryland

http://taxes.marylandtaxes.com/Business_Taxes/Business_Tax_Types/Income_Tax/Employer_Withholding/Withholding_
Tables/Percentage_Method.shtml

Massachusetts

http://www.mass.gov/dor/docs/dor/forms/wage-rpt/pdfs/circ-m14.pdf

Michigan

http://www.michigan.gov/documents/taxes/78_442440_7.pdf

(effective October 1, 2013


January 1, 2014)

http://www.michigan.gov/documents/taxes/446_2013_442640_7.pdf
Minnesota

http://www.revenue.state.mn.us/Forms_and_Instructions/2012/wh_inst_14.pdf

Missouri

http://dor.mo.gov/pdf/formula.pdf

New Mexico

http://www.tax.newmexico.gov/SiteCollectionDocuments/Publications/FYI-Publications/FYI-104__NEW%20MEXICO%20
WITHHOLDING%20TAX_12-3-13.pdf

New York
(state and City of Yonkers)

http://www.tax.ny.gov/pdf/publications/withholding/nys50_t_nys.pdf

North Carolina

http://www.dornc.com/downloads/nc30.pdf

North Dakota

http://www.nd.gov/tax/indwithhold/pubs/withholdingbooklet2014.pdf?20140106135101

Ohio

http://www.tax.ohio.gov/portals/0/forms/employer_withholding/2014/WTH_Instructions.pdf
http://www.tax.ohio.gov/portals/0/forms/school_district_income/2014/WTH_EmployerLetter.pdf

Oklahoma

http://www.tax.ok.gov/publicat/2014WHTables.pdf

Oregon

http://www.oregon.gov/dor/BUS/docs/withholding-tax-formulas_206-436_2014.pdf

Puerto Rico

http://www.hacienda.gobierno.pr/downloads/pdf/publicaciones/TABLAS_RETENCION_2014.pdf

Rhode Island

http://www.tax.ri.gov/forms/2014/Withholding/2014%20Withhholding%20Booklet.pdf

Vermont

http://www.state.vt.us/tax/pdf.word.excel/business/2014-Withholding-Instructions-Charts-Tables.pdf

14 | US employment tax rates and limits for 2014 Preliminary

Ernst & Young LLP employment tax advisory contacts


Mary Angelbeck
mary.angelbeck@ey.com
+1 215 448 5307

Ken Hausser
kenneth.hausser@ey.com
+1 732 516 4558

Anthony Arcidiacono
anthony.arcidiacono@ey.com
+1 732 516 4829

Nicki King
nicki.king@ey.com
+1 214 756 1036

Peter Berard
peter.berard@ey.com
+1 212 773 4084

Kristie Lowery
kristie.lowery@ey.com
+1 704 331 1884

Gregory Carver
gregory.carver@ey.com
+1 214 969 8377

Thomas Meyerer
thomas.meyerer@ey.com
+1 202 327 8380

Bryan De la Bruyere
bryan.delabruyere@ey.com
+1 404 817 4384

Chris Peters
christina.peters@ey.com
+1 614 232 7112

Jennie DeVincenzo
jennie.devincenzo@ey.com
+1 732 516 4572

Matthew Ort
matthew.ort@ey.com
+1 214 969 8209

Richard Ferrari
richard.ferrari@ey.com
+1 212 773 5714

Stephanie Pfister
stephanie.pfister@ey.com
+1 415 894 8519

David Germain
david.germain@ey.com
+1 516 336 0123

Debera Salam
debera.salam@ey.com
+1 713 750 1591

Julie Gilroy
julie.gilroy@ey.com
+1 312 879 3413

Debbie Spyker
deborah.spyker@ey.com
+1 720 931 4321

Mary Gorman
mary.gorman@ey.com
+1 202 327 7644

Mike S. Willett
mike.willett@ey.com
+1 404 817 4637

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