2017 Minimum Wage Changes

Many states will be increasing their minimum wage in 2017.  Check the list below to make sure you are in compliance in all states which you have employees.  Most of these changes are effective January 1, 2017 unless otherwise indicated.

  • Alaska: $9.80
  • Arizona: $10.00
  • Arkansas: $8.50
  • California: $10.50 (employers with 25 or less employees will remain at $10)
  • Colorado: $9.30
  • Connecticut: $10.10
  • District of Columbia: $12.50 (effective July 1, 2017) ($3.33 for tipped employees)
  • Florida: $8.10 ($5.08 for tipped employees)
  • Hawaii: $9.25
  • Maine: $9.00 (effective January 7, 2017)
  • Maryland: $9.25 (effective July 1, 2017)
  • Massachusetts: $11.00 ($3.75 for tipped employees)
  • Michigan: $8.90 ($3.38 for tipped employees)
  • Missouri: $7.70 ($3.85 for tipped employees)
  • Montana: $8.15
  • New Jersey: $8.44
  • New York: $9.70 (effective December 31, 2016) ($11.00 for employers in NYC with 11 or more employees; $10.50 for employees in NYC with 10 or fewer employees; $10.00 for Long Island and Westchester, $10.75 for fast food employees outside of NYC; $12.00 for fast food employees in NYC)
  • Ohio: $8.15
  • Oregon: $10.25 (effective July 1, 2017)
  • Rhode Island: $3.89 for tipped employees (non-tipped employees have no change, remains at $9.60)
  • South Dakota: $8.65 ($4.325 for tipped employees)
  • Vermont: $10.00
  • Washington: $11.00

Note: There may be local wage requirements that are higher than the state minimum wage which would apply to your business.

Increased Social Security Payroll Taxes in 2017 for High Wage Workers

On October 18, 2016 the Social Security Administration (SSA) announced that the maximum amount of wages subject to the Social Security payroll tax will i2017-tax-update-1ncrease in 2017 by $8,700 to $127,200.  This adjustment, which takes place on January 1, 2017, is calculated by the SSA based on average wage increases.

Social Security payroll tax is collected with Medicare payroll tax as the Federal Insurance Contributions Act (FICA) tax.  In a traditional employment relationship, FICA taxes are paid by both employers and employees.  Employers and employees both pay 6.2% of taxable wage for the Social Security portion up to the annual maximum level and pay 1.45% of taxable wage for the Medicare portion.  There is no limit on the Medicare portion, however under a provision of the Affordable Care Act, highly compensated employees are required to pay an additional 0.9% in Medicare tax for all wages over $200,000 per year.  Employers are not required to pay this additional Medicare tax.

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