--- title: Payroll Tax Rates and Contribution Limits for 2023 description: FocusPay Solutions provides business owners with federal payroll tax rates for 2023. image: https://info.machen.cpa/hubfs/payroll%20tax%20rates%20-1200688693-1.jpeg --- [Family of Services](http://machenmcchesney.com/about-us/family-of-companies/)  |  [CPA & Business Advisory](http://machenmcchesney.com)  |  [Payroll, HR & Benefits](http://focuspaysolutions.com/)  |  [Wealth Management](http://machenmcchesney.com/services/financial-planning-and-wealth-mangement-services/) Auburn-Opelika (334) 887-7022 | Montgomery (334) 244-8900 [![mm-cobrand-fd-blues](https://info.machen.cpa/hs-fs/hubfs/mm-cobrand-fd-blues.png?width=279&height=100&name=mm-cobrand-fd-blues.png)](http://machenmcchesney.com) Search this site on Google Search Google Search this site on Google Search Google - [Client Portal](https://machenmcchesney.sharefile.com/Authentication/Login) - [1040 Electronic Organizer](https://www.my1040data.com/account/login/HT7902990) - 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The Social Security wage base is **$160,200** for employers and employees, increasing from $147,500 in 2022. Self-employed people must pay 12.4% on the first $160,200. **Medicare tax** In 2023, the Medicare tax rate for employers and employees is **1.45%** of all wages, unchanged from 2022. Self-employed people must pay 2.9% on all net earnings. **Additional Medicare tax** In 2023, the additional Medicare tax remains unchanged at **0.9%**. This tax applies to wages and self-employment income over [certain thresholds](https://www.irs.gov/businesses/small-businesses-self-employed/questions-and-answers-for-the-additional-medicare-tax) ($200,000 for single filers and $250,000 for joint filers). **401(k) limits** In 2023, the maximum contributions are as follows: - Employee (age 49 or younger) = **$22,500** up from $20,500 in 2022. - Employee catch-up (age 50 or older) = **$7,500,** up from $6,500 in2022. Employees can contribute up to **$15,500** in 2023, up from $14,000 in 2022,to a SIMPLE 401(k) plan. **HSA and HDHP limits** In 2023, the maximum contributions to a health savings account are as follows: - Employer and employee = **$3,850 (self only), $7,750 (family)**. - Catch-up amount (age 55 or older) = **$1,000**. In 2023, the limits for a high-deductible health plan are as follows: - Minimum deductibles = **$1,500 (self only), $3,000 (family)**. - Maximum out-of-pocket amounts = **$7,500 (self only), $15,000 (family)**. **FSA limits** In 2023, employees can contribute: - Up to **$3,050**, a slight increase from 2022. - Up to **$5,000** to a dependent care FSA if filing single or jointly, and up to **$2,500** if married but filing separately. These are unchanged from 2022. **QSEHRA limits** In 2022, employers with a qualified small employer health reimbursement arrangement can reimburse employees for health care expenses as follows: - **$5,850 (self only)**, up slightly from 2022. - **$11,800 (family)**, up slightly from 2022. **Commuter benefits limit** In 2022, employees can contribute up to **$300 per month** for qualified commuter benefits (e.g., mass transit and parking), up from $280 per month in 2022. **Adoption assistance exclusion limit** In 2023, up to **$15,950** in employer-sponsored adoption assistance may be excluded from an employee's gross wages, increasing from $14,890 in 2022. Remember, these are all federal rates and limits. Be sure to check with the necessary agencies for state and local payroll rates. Also, various limits and additional rules may apply.  **For additional information on [employee benefits administration and management](https://focuspaysolutions.com/services/benefits/?__hstc=31761121.6de975eee04bf28563fdf1daa415e270.1659647291102.1675886368918.1675891901935.251&__hssc=31761121.5.1675891901935&__hsfp=1328628976),** **please contact Amber Malik (334) 321-4729 or by leaving us a message below.**  Topics: [Payroll, HR & Benefits](https://info.machen.cpa/blog/topic/payroll-hr-benefits) Search this site on Google Search Google ### Recent Posts ### Subscribe to Blog ### Posts by Category - [Business Tax (356)](https://info.machen.cpa/blog/topic/business-tax) - [Business Advisory (238)](https://info.machen.cpa/blog/topic/business-advisory) - [Payroll, HR & Benefits (124)](https://info.machen.cpa/blog/topic/payroll-hr-benefits) - [Audit & Assurance (113)](https://info.machen.cpa/blog/topic/audit-assurance) - [Accounting & Outsourcing (81)](https://info.machen.cpa/blog/topic/accounting-outsourcing) - [Individual Tax (75)](https://info.machen.cpa/blog/topic/individual-tax) - [Tax Planning (33)](https://info.machen.cpa/blog/topic/tax-planning) - [Tax Updates (25)](https://info.machen.cpa/blog/topic/tax-updates) - [Retirement & Wealth Management Planning (18)](https://info.machen.cpa/blog/topic/retirement-wealth-management-planning) - [Taxation (15)](https://info.machen.cpa/blog/topic/taxation) - [Alerts (13)](https://info.machen.cpa/blog/topic/alerts) - [Business Valuation (11)](https://info.machen.cpa/blog/topic/business-valuation) - [News & Events (11)](https://info.machen.cpa/blog/topic/news-events) - [Tax News (11)](https://info.machen.cpa/blog/topic/tax-news) - [Individual Tax Planning (10)](https://info.machen.cpa/blog/topic/individual-tax-planning) - [Not For Profit (10)](https://info.machen.cpa/blog/topic/not-for-profit) - [Retirement Planning (9)](https://info.machen.cpa/blog/topic/retirement-planning) - [Estate Planning (8)](https://info.machen.cpa/blog/topic/estate-planning) - [Manufacturing Industry Insights (7)](https://info.machen.cpa/blog/topic/manufacturing-industry-insights) - [Individuals (1)](https://info.machen.cpa/blog/topic/individuals) - [Insider (1)](https://info.machen.cpa/blog/topic/insider) - [Professional Standard News (1)](https://info.machen.cpa/blog/topic/professional-standard-news) see all [![Returning\_Value](https://info.machen.cpa/hs-fs/file-2504250850-jpg/Machen-Blog-Image/Returning_Value.jpg)](http://machenmcchesney.com/about-us/mission-and-values/) - [![AICPA](https://machenmcchesney.com/img/logos/aicpa.jpg)](https://www.aicpa-cima.com/) - [![NACVA](https://machenmcchesney.com/img/logos/nacva.jpg)](http://www.nacva.com/) - ![2026 INSIDE Public Accounting Top 400](https://machenmcchesney.com/img/2026-ipa-top-400.jpg) - ![2026 Best of Auburn-Opelika](https://machenmcchesney.com/img/2026-best-of-auburn-opelika.jpg) - [![2025 Best of OA](https://machenmcchesney.com/img/2025-best-of-oa.jpg)](https://oanow.com/exclusive/readerschoice/ballot-2025/) - ![2026 Best of OA Winner](https://machenmcchesney.com/img/2026-best-of-oa-winner.jpg) - [![2025 Accounting Today Regional Leaders](https://machenmcchesney.com/img/2025-accounting-today-regional-leaders.jpg)](https://www.accountingtoday.com/) - [![ClearlyRated Best of Accounting](https://machenmcchesney.com/img/2024-best-of-accounting.jpg)](https://www.clearlyrated.com/accounting) - [![ClearlyRated Best of Accounting Employee](https://machenmcchesney.com/img/2024-best-of-accounting-employee.jpg)](https://www.clearlyrated.com/accounting) 1820 East University Drive, Auburn, AL 36830 | Tel: (334) 887-7022 | Fax: (334) 887-7221 1761 Taliaferro Trail, Montgomery, AL 36117 | Tel: (334) 244-8900 | Fax: (334) 364-0927 † This is not a CPA firm. \* Assurance, attest, and audit services provided by Frazier & Deeter, LLC. “Frazier & Deeter” is the brand name under which Frazier & Deeter, LLC\* and Frazier & Deeter Advisory, LLC† and its subsidiary entities provide professional services. 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