SR 22-02 Dated 01/22

STATE OF NEW HAMPSHIRE

INTER-DEPARTMENT COMMUNICATION- BUREAU OF FAMILY ASSISTANCE BFA

SUMMARY

This SR releases the updated figures for the 2022:

• Withholding rates for Social Security FICA (Federal Insurance Contributions Act) and FIT (Federal Income Tax); and

• FICA income ceiling.

FICA and FIT withholding rates are allowed in determining self-employment income for most programs and nursing facility and HCBC employment expense disregards. Employment expense disregards are based on allowable FIT and FICA withholding deductions.

POLICY

Social Security FICA

• The 2022 FICA withholding rate for both employees and employers has not changed and will remain at 7.65%. This subdivides into 6.20% for the Social Security (OASDI) share and 1.45% for Medicare’s (HI) portion.

• Self-employed individuals pay a FICA withholding rate of 15.3%. These individuals may deduct from income tax one half of the 15.3% paid for the year as a business expense. The actual rate becomes 7.65% after the deduction.

• For employees and employers, the Medicare portion of the FICA rate is 1.45% on 100% of earned income; for a self-employed individual, the rate is 2.9% on 100% of earned income.  

FICA Income Ceiling

• The income ceiling subject to the full FICA withholding rate has increased from $142,800 to $147,000.

• There is no ceiling to the amount of gross earned income from which Medicare may be withheld.

FIT (Federal Income Tax)

District Offices use the IRS Publication 15 (Circular E) to determine the applicable federal income tax (FIT) withholding rate. As of January 1, 2022, the 2021 Circular E will be obsolete. Electronic copies of the January 2022 IRS Circular E will be sent to each District Office under separate cover when they are released by the IRS.  

Federal Minimum Wage

The 2022 Federal minimum wage, effective since 7/24/09, remains at $7.25 per hour.

NEW HEIGHTS & NH EASY SYSTEMS PROCEDURES AND IMPLEMENTATION

NEW HEIGHTS & NH EASY SYSTEMS PROCEDURES AND IMPLEMENTATION

There are no system changes associated with this information release.

POLICY MANUAL REVISIONS

Revised Adult Assistance Manual Topics

PART 601, TABLE H Federal Taxes, Income Ceilings, and Federal/State Minimum Wages

Section 603.03 Employment Expense Disregard (EED)

Revised Family Assistance Manual Topics

PART 601, TABLE H Federal Taxes, Income Ceilings, and Federal/State Minimum Wages

Revised Food Stamp Manual Topics

PART 601, TABLE H Federal Taxes, Income Ceilings, and Federal/State Minimum Wages

Revised Medical Assistance Manual Topics

PART 601, TABLE H Federal Taxes, Income Ceilings, and Federal/State Minimum Wages

Section 603.03 Employment Expense Disregard (EED)

IMPLEMENTATION

All policy changes in this SR are effective January 1, 2022.

CLIENT NOTIFICATION

No special client notification is planned or required.

TRAINING

No special training is planned or needed.

DISPOSITION

This SR may be destroyed or deleted after its contents have been noted and the revised manual topics released by this SR have been posted to the On-line manuals.

DISTRIBUTION

This SR will be distributed according to the electronic distribution list for Bureau of Family Assistance policy releases. Revised On-Line Manuals will be available for agency staff in the On-Line Manual Library, and for public access on the Internet at www.dhhs.nh.gov/dfa/publications.htm, effective January 3, 2022. This SR will be available for agency staff in the On-Line Manual Library, and for public access on the Internet at www.dhhs.nh.gov/dfa/publications.htm, effective January 3, 2022.

BFA//jlg:s