7c. Update Social Security tax pay code
After the federal tax rates are updated, look up the Social Security pay code to update the Social Security maximum wage limit for the new payroll year.
There may be changes to the Social Security tax percentage and maximum wage limit. The new federal Social Security wage limit is available online at irs.gov and Publication 15 (Circular E) Employer's Tax Publication 15 (Circular E) Employer's Tax Guide. If the Social Security tax percentage and wage limit have changed, you will need to update the Social Security tax pay code with the new Social Security wage limit on the employee and employer portion of the pay code.
Note: In the Payroll Year-end Checklist for 2023, This step was included in step 7b, but it has been moved to step 7c because some sites were installing the federal and state tax rates without updating the Social Security wage limit.
Webinar: Step 7A-C. Update tax tables, Social Security limits
Updating Social Security wage limit
1. Open Connect Payroll > Organization > Pay Codes.
2. Look up the Social Security tax (74-00) pay code.
If Caselle converted your data, then the Social Security tax pay code is 74-00. However, your organization may use a different pay code number for Social Security tax.
3. Click Employee tab > Employee subtab.
Update the employee portion of the Social Security tax pay code with the percentage and maximum wage limit for the new payroll year.
Change the employee portion of the Social Security tax pay code.
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Employee percentage. Enter -6.20%
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Employee maximum wage limit. Enter 176,100.000
4. Click the Employer tab > Employer tab.
Update the employer portion of the Social Security tax pay code with the percentage and maximum wage limit for the new payroll year.
Change the employer portion of the Social Security tax pay code.
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Employer percentage. Enter 6.20%
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Employer maximum wage limit. Enter 176,100.000
5. Click Save (CTRL+S).
The Social Security tax pay code has been updated with the employee and employer percentage and maximum wage limit for the new payroll year.
You're done!
Congratulations! You're done with the Payroll Year-end Checklist. You're ready to run the first payroll of the new payroll year.
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