The shutdown of the federal government earlier this autumn meant that the IRS was very late in releasing the 2014 personal exemption amount, which doubles as the annual withholding allowance amount. Also late, but now in the bag: the 2014 amounts for qualified transportation fringes. (Rev. Proc. 2013-35, IRB 2013-47)
2014 withholding allowance amounts. Before you figure employees’ withholding, you must subtract out the value of withholding allowances they claim on their W-4 forms. Reminder: If employees claim more than one allowance, multiply the value of one allowance by the number they’ve claimed. The value of one allowance per pay period in 2014 is:
- Weekly: $75.96
- Biweekly: $151.92
- Semimonthly: $164.58
- Monthly: $329.17
- Quarterly: $987.50
- Semiannual: $1,975.00
- Annual: $3,950.00
Qualified transportation fringes. The monthly tax-free reimbursement for qualified employer-provided parking increases $5, to $250. However, unless Congress again extends parity between parking and mass transit benefits, the monthly tax-free exclusion for mass transit benefits and rides in commuter vehicles decreases substantially—to $130. Bicycle fringes are $20 a month, and can’t be funded on a pretax basis.
THE WAITING IS THE HARDEST PART: For all the news and the withholding tables, keep your browser pointed to "FICA wage base, retirement contribution limits increase for 2014.".
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