What is the 2018 social security wage base?

The 2018 Social Security wage base was set at $128,400, which represents the maximum amount of earnings on which Social Security tax is assessed for that year. This figure is important for employers and employees as it determines the threshold for Social Security contributions, meaning that any earnings above this amount are not subject to Social Security tax.

The Social Security Administration adjusts the wage base each year based on changes in national average wages to ensure that the system remains adequately funded. Understanding the wage base is essential for payroll professionals to accurately calculate tax withholdings and ensure compliance with federal regulations.

The other options represent figures that are either significantly lower than the actual wage base or imply that there is no cap on earnings subject to Social Security tax, which is not the case. Having a maximum wage base is crucial for the functioning of the Social Security system, which relies on contributions from workers' earnings.