*** 2025 tax bracket percentages and standard exemptions have NOT changed.  Most of the breakpoint & tax amounts HAVE changed***  for the typical inflationary increases. Please report any suspected discrepancies or questions to the MVS Alliance support team ASAP.

Below are the Federal figures needed in the Tax Table Maintenance program (Task 23 in the Payroll module).  The ‘codes’ indicate its purpose, for example: USWKLY means Weekly Single rates for Federal Withholding.  US- United States; WK – Weekly; SL – Single.  Please see the document titled:  2025 FICA & FUTA LIMIT & PERCENTAGE RATES for additional information, especially regarding FICA limits, printing W2 forms and first payroll for a new year.

These rates are based on the http://www.irs.gov/ website Publication 15-T, Federal Income Tax Withholding Methods 2025.  Refer to section 5. Percentage Method Tables for Manual Payroll Systems With Forms W-4 From 2019 or Earlier.

Social security and Medicare tax for 2025. The social security tax rate is 6.2% each for the employee and employer, unchanged from 2024. The social security wage base limit is $176,100 which has increased from 2024.

The Medicare tax rate is 1.45% each for the employee and employer, unchanged from 2024. There is no wage base limit for Medicare tax. 

Withholding allowance. The 2025 amount for one with-holding allowance on an annual basis is $4,300.00 which is unchanged from 2024.

Reminders

Additional Medicare Tax withholding. In addition to withholding Medicare tax at 1.45%, you must withhold a 0.9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Additional Medicare Tax is only imposed on the employee. There is no employer share of Additional Medicare Tax. All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold.  ** The threshold amount for those "Married filing jointly" is $250,000 and those filing "Married filing separately is $125,000 **.

For more information on what wages are subject to Medicare tax or on Additional Medicare Tax, visit the IRS.gov website.

2025 FUTA:

For 2025, the FUTA tax rate is unchanged at 6.0%. Please note that if your state & specific situation qualify for the maximum credit of 5.4% then your effective FUTA rate in the Profits Plus payroll system should remain unchanged at 0.60% as well.  The tax applies to the first $7,000 you pay to each employee as wages during the year. The $7,000 is the federal wage base. Your state wage base may be different.  

To verify these figures for you specific situation you should contact the appropriate tax authority or your accountant/CPA.   

Updating your federal tax tables:

• To update the Federal tax tables go to Payroll (Module 1)
  • Tax table Maintenance (Task 23)
    • Change existing tax record (Sub-task 2) 

In all tables, fields  3-8 & 16-20 are zero's / unused again for 2025.