IMPORTANT – 2026 Changes for Businesses

Starting in 2026, participants aged 50 or older who earned more than $145,000 in FICA wages in the previous calendar year will be required to make all catch-up contributions as Roth contributions. This is a significant change to previous rules that allowed catch-up contributions to be either pre-tax or Roth.
Please check with your plan administrator and advise Payroll Service Solutions in writing if you need us to make any changes for 2026. As Payroll Service Solutions does not know the details of your individual retirement plan, we cannot make this determination for you. We will continue to make the retirement deductions as currently setup unless you instruct us otherwise.

• 401k Deferral Limit increases from $23,000 to $23,500
• If you are over 50 years old the limit increases to $31,000
• Simple IRA Limit increases from $16,000 to $16,500
• If you are over 50 years old the limit increases to $19,500
• Traditional and Roth IRA limits remain unchanged at $7,000
• If you are over 50 years old the limit remains unchanged at $8,000

Reminder – Federal and State Unemployment taxes start again in 2026 until the limits are reached for each employee.

Please note that the information provided here is for your convenience and may be subject to change.  It is important to clarify that this information does not constitute legal or tax guidance.  If you have any questions or concerns that go beyond the realm of our payroll services, we highly recommend consulting a qualified CPA, tax attorney or tax advisor. Thank you for choosing us to handle your payroll needs.