Social Security



For those currently employed:

• The annual wage limit subject to the 6.2% FICA tax has increased to $176,100 for 2025 wages (up from $168,600 for a 4.4% increase)

For those receiving SS benefits:

• The annual COLA (cost of living adjustment) has been set at 2.5%. As a result, your SS benefits will increase by 2.5% starting January, 2025.
• For those that started receiving SS benefits before their full retirement age (FRA), the maximum amount you can earn without any reduction in your SS benefit increased to $23,400 (from $22,320 for a 4.8% increase). If 2025 is the year you reach FRA, then the maximum amount you can earn increased from $59,520 to $62,160.
• For 2025, the monthly base Part B Medicare premium (for doctor's services and non-hospital care) will increase to $185.00 (from $174.70 in 2024)
• The MAGI thresholds that will cause an increase in the base Part B premiums have also increased. The first increase occurs when MAGI exceeds $106,000 for individuals and $212,000 for married couples (up from $103,000 and $206,000, respectively, in 2024). Note MAGI is based upon your 2023 tax return filed.

CO Minimum Wage

• The state minimum wage for CO will increase from $14.42 to $14.81 (a 2.7% increase) on January 1st.
• The minimum wage for tipped employees will also increase from $11.40 to $11.79 (a 3.4% increase).



Denver Minimum Wage

• Given the number of clients that operate in Denver, please note the minimum wage in Denver will increase to $18.81 from $18.29 (a 2.8% increase)
• For tipped employees, the Denver minimum wage will increase to $15.79 from $15.27 (a 3.4% increase)

TCJA Sunset

We have highlighted before that TCJA (Tax Cut and Jobs Act from 2017) could potentially sunset at the end of 2025.

Although all indications are that a Trump administration will extend the provisions of TCJA, it is still difficult to predict what will happen (and when).

As a reminder, here are the major TCJA provisions that could potentially expire if nothing is done.

• Income tax brackets - individual income tax rates will revert back to 2017 levels which in most cases were higher than they are under TCJA
• The current 12% tax bracket becomes 15%, 22% becomes 25%, 24% become 28%, 32% become 33% and 37% become 39.6%
• The 10% and 35% brackets remain unchanged
• The QBI deduction (which allows business owners to reduce taxable business income by 20%) goes away.
• Pre TCJA, the standard deduction was $6,500 for single filers and $13,000 if married. These amounts are inflation adjusted each year but essentially doubled with TCJA. For 2024, the standard deduction is $14,600 for single filers and $29,200 for married filers.
• Lifetime estate and gift tax exemption, which for 2024 is $13.6M if single and $27.2M if married, would revert back to pre-TCJA level but adjusted for inflation. Best guess is this would be $7M if single and $14M is married.

Digital Currency Reporting

The IRS has previously announced plans to regulate virtual currency. Currently, financial institutions that manage your virtual currency are not required to provide detail on sales/cost basis like is currently required on other investments such as stocks.

Beginning in 2025 (for taxes filed in 2026), these financial institutions will be required to issue a new form called a 1099-DA that will provide sale and cost basis information.

Be aware that some institutions are expected to start this process for 2024 on a trial basis. As a result, you may receive a 1099-DA in early 2025 (for 2024 activity). If you do receive this, please be sure to share the document with us.