Year End: Top 7 things you need to know for 2015
The end of the year is approaching and businesses are wrapping up and preparing for next year. Here are the top 7 things you need to know for 2015:
- Higher 401(k) contribution limits. Taxpayers will be able to contribute up to $18,000 to their 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan in 2015, which is $500 more than in 2014. The catch-up contribution limit for employees age 50 and older will also grow by $500 to $6,000 in 2015.
- Higher elective deferrals for SIMPLE plans. The 2015 maximum is increased to $12,500, up $500.
- Social Security base has increased to $118,500. Once your gross wages have reached this amount in a calendar year, social security tax will no longer be calculated for the employee and employer.
- Unemployment rates change each year for some states. Look for your notification and update the rate in your payroll program so that paychecks in 2015 are calculating this employer tax properly.
- IRA contribution limits unchanged. The IRA contribution limit will remain $5,500 in 2015. Investors age 50 and older can contribute an additional $1,000 to an IRA
- The standard mileage rate for 2015 for the use of a car, van, pickup or panel truck is 57.5 cents per mile for business miles driven, up from 56 cents in 2014. Two good applications to track mileage are Expensify and Tallie. You can sign up for a free trial at
- Gather your W9’s from contractors and vendors to determine which are eligible for 1099-Misc reporting. Individuals, sole proprietors, and single-entity LLC’s are eligible. When in doubt, file a 1099-Misc. When you’ve reimbursed a contractor for material, include this in the amount reported. The contractor can deduct these expenditures and is responsible for providing the receipts.
- Start the budgeting and planning process for next year. Besides the budgeting feature that is included with your subscription to QuickBooks Online (Plus version only), you can use LifePlan which integrates with QBO, and is more robust. You can learn more about it here: http://www.liveplan.com/
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