Despite the simple and catchy sound-bites, the “no tax on tips” and “no tax on overtime” opportunities under the One Big Beautiful Bill Act (the “OBBBA”) have limits and require administration by both employers and employees. Most significantly, the tax savings are in the form of deductions, rather than exclusions, which means that tips and
IRS Releases Annual Increases to Qualified Retirement Plan Limits for 2026
By Jesse T. Foley & Justin Alex on
On November 13th, the IRS released a number of inflation adjustments for 2026, including to certain limits for qualified retirement plans. The table below provides an overview of the key adjustments for qualified retirement plans.
Qualified Defined Benefit Plans
| 2025 | 2026 | Increase from 2025 to 2026 | |
| Annual Maximum Benefit | $280,000 | $290,000 | $10,000 |
Qualified…
IRS Releases Annual Increases to Health FSA and Transportation Fringe Benefit Limits for 2026
By Justin Alex & Jesse T. Foley on
On October 9th, the IRS announced several inflation adjustments for 2026, including adjustments to the annual contribution and carryover limits for healthcare flexible spending accounts and the monthly limit for qualified transportation fringe benefits. Separately, the One, Big, Beautiful Bill increased the contribution limit for dependent care flexible spending accounts from $5,000 (or $2,500 for…
FICA Tax: Navigating the Nonqualified Deferred Compensation Special Timing Rule
By Tyler Forni, David B. Teigman & Andrea S. Rattner on
Compensation is generally subject to federal income tax and FICA tax when compensation is actually paid to an employee. However, nonqualified deferred compensation (NQDC) may be subject to FICA taxation before federal income taxation under a FICA tax special timing rule. The scope of NQDC subject to FICA taxation is broad, including voluntary deferrals of…