Timeline
When will this be released?
December 11, 2025 5-6 PM PST
Is there downtime for this release?
No
New Taxes
Kentucky
City of Walton
Effective January 1, 2026, the City of Walton has established a 2% occupational tax for all residents and nonresidents performing services within the city. The tax applies to wages and compensation up to the 2026 Social Security wage base of $184,500. The City of Walton Occupational License Fee (OLF) is administered by Boone County and must be filed and paid quarterly.
Grace Commercial Park TIF added
Effective October 1, 2019, Graves County has established a 1% Tax Increment Financing (TIF) assessment. While the tax went into effect October 1, 2019, the first building on the lot was completed in September 2023. The tax is 1% of all wages and compensation for work performed within the Grace Commercial Park Development Area by every resident and nonresident employee. This TIF tax "stacks" with the Graves County OLF tax, resulting in a total stacked rate of 2%.
Minnesota
Effective January 1, 2026, the Minnesota Department of Employment and Economic Development has established a new paid leave program funded by a shared employer and employee premium.
The tax was previously added as a placeholder within CBS. With this release, we've added the employee calculation logic.
Additional information regarding the tax is available on the Minnesota Paid Leave website.
Updated Taxes
Federal
Social Security Tax Wage increased
Effective January 1, 2026, the Social Security Tax wage base increased from $176,100 to $184,500.
https://www.ssa.gov/oact/cola/cbb.html
Federal Income Tax updated for 2026
Effective January 1, 2026, the federal tax tables have been updated based on the latest 2026 Publication 15-T draft: Publication 15-T Draft. The tax tables (percentage method tables on page 12) have been updated.
https://www.irs.gov/pub/irs-dft/p15t--dft.pdf
Federal Legislative Limits for 2026
Effective January 1, 2026, the Federal Legislative deduction limits for 2026 have been updated.
IRS Link for 2026 Limits - https://www.irs.gov/pub/irs-drop/n-25-67.pdf
IRS Link for HSA Limits - https://www.irs.gov/pub/irs-drop/rp-25-19.pdf
California
California SDI Rate Updated
Effective January 1, 2026, the California SDI rate increased from 1.2% to 1.3%.
https://edd.ca.gov/en/Payroll_Taxes/Rates_and_Withholding
Colorado
Colorado Paid Family and Medical Leave updated
Effective January 1, 2026, the Colorado Paid Family and Medical Leave tax rate decreased from 0.9% to 0.44%. Additionally, the wage base increased from $176,100 to $184,500.
https://www.ssa.gov/oact/cola/cbb.html
Colorado Solvency Surcharge updated
Effective January 1, 2026, the Colorado Solvency Surcharge wage base increased from $27,200 to $30,600. The new employer rate remains 1.35% for 2026.
https://cdle.colorado.gov/employers/unemployment-insurance-premiums/premium-rates
Colorado Support Surcharge updated
Effective January 1, 2026, the Colorado Support Surcharge wage base increased from $27,200 to $30,600. The new employer rate remains 0.17% for 2026.
https://cdle.colorado.gov/employers/unemployment-insurance-premiums/premium-rates
Connecticut
Connecticut Paid Leave wage base increased
Effective January 1, 2026, the Connecticut Paid Leave wage base increased from $176,100 to $184,500.
https://www.ssa.gov/oact/cola/cbb.html
Connecticut State Unemployment Tax updated
Effective January 1, 2026, the Connecticut State Unemployment Tax rate decreased from 2.2% to 1.9%. Additionally, the wage base increased from $26,100 to $27,000.
Kansas
Kansas State Unemployment Tax updated
Effective January 1, 2026, the Kansas State Unemployment Tax wage base increased from $14,000 to $15,100. The rate remains 1.75%.
https://www.dol.ks.gov/employers/employer-services
Kentucky
Kentucky State Tax rate updated
Effective January 1, 2026, the Kentucky State Tax rate decreased from 4% to 3.5%. Additionally the standard deduction increased from $3,270 to $3,360.
https://revenue.ky.gov/Business/Pages/Employer-Payroll-Withholding.aspx
Alexandria - OLF wage base increased
Effective January 1, 2026, the Alexandria - OLF wage base increased from $176,100 to $184,500.
https://campbellcountyky.gov/division/blocks.php?structureid=49
Bardwell - OLF rate updated
Effective July 1, 2025, the Bardwell - OLF rate increased from 0.5% to 1%.
https://www.carlislecountyky.com/bardwell-ky/
Boone County - OLF wage base increased
Effective January 1, 2026, the Boone County - OLF wage base increased from $77,400 to $79,494. The tax rate remains 0.8%.
https://cms7files.revize.com/boonecountyky/docs/OL/2026/General/0207%20Tax%20Rate%20for%202026.pdf
Campbellsville - OLF rate updated
Effective January 1, 2026, the Campbellsville - OLF rate increased from 1% to 1.5%.
https://campbellsville.us/
Campbell County - Mental Health Tax wage base increased
Effective January 1, 2026, the Campbell County - Mental Health Tax wage base increased from $176,100 to $184,500.
https://campbellcountyky.gov/division/blocks.php?structureid=49
Campbell County - OLF wage base increased
Effective January 1, 2026, the Campbell County - OLF wage base increased from $176,100 to $184,500.
https://campbellcountyky.gov/division/blocks.php?structureid=49
Cold Spring - OLF wage base increased
Effective January 1, 2026, the Cold Spring - OLF wage base increased from $176,100 to $184,500.
https://campbellcountyky.gov/division/blocks.php?structureid=49
Florence - OLF wage base increased
Effective January 1, 2026, the Florence - OLF wage base increased from $176,100 to $184,500.
https://florence-ky.gov/our-services/finance/
https://www.ssa.gov/oact/cola/cbb.html
Highland Heights - OLF rate and wage base increased
Effective January 1, 2026, the Highland Heights - OLF rate increased from 1% to 1.5%. Additionally, the wage base increased from $176,100 to $184,500.
https://campbellcountyky.gov/division/blocks.php?structureid=49
Jackson - OLF wage base increased
Effective January 1, 2026, the Jackson - OLF wage base increased from $176,100 to $184,500.
https://cityofjacksonky.org/forms.html
https://www.ssa.gov/oact/cola/cbb.html
Jenkins - OLF rate updated
Effective January 1, 2026, the Jenkins - OLF rate increased from 1.5% to 2%.
https://kydlgweb.ky.gov/Cities/16_CityView.cfm?City_ID=218
Newport - OLF wage base increased
Effective January 1, 2026, the Newport - OLF wage base increased from $176,100 to $184,500.
https://www.newportky.gov/193/Taxes
https://www.ssa.gov/oact/cola/cbb.html
Simpson County - Occupational License Fee (OLF) rate updated
Effective January 1, 2026, the Simpson County - Occupational License Fee (OLF) rate increased from 1% to 1.25%.
https://simpsoncountyky.gov/occupational-tax-administration/
Union - OLF wage base increased
Effective January 1, 2026, the Union - OLF wage base increased from $176,100 to $184,500.
https://cityofunionky.org/taxes/
https://www.ssa.gov/oact/cola/cbb.html
Wilder - OLF wage base increased
Effective January 1, 2026, the Wilder - OLF wage base increased from $176,100 to $184,500.
https://campbellcountyky.gov/division/blocks.php?structureid=49
Williamstown - OLF rate updated
Effective January 1, 2026, the Williamstown - OLF rate decreased from 1.5% to 1%.
https://wtownky.org/business/occupational_tax.php
Louisiana
Louisiana State Unemployment Tax wage base decreased
Effective January 1, 2026, the Louisiana State Unemployment Tax wage base decreased from $7,700 to $7,000.
https://www.laworks.net/UnemploymentInsurance/UI_LAInsuranceTaxRates.asp
Maine
Maine Paid Family and Medical Leave updated
Effective January 1, 2026, the Maine Paid Family and Medical Leave wage base increased from $176,100 to $184,500.
https://www.maine.gov/paidleave/
https://www.ssa.gov/oact/cola/cbb.html
Maine State Tax updated
Effective January 1, 2026, the Maine State Tax has been updated:
- The Maine personal exemption amount increased from $5,150 to $5,300
- The standard deduction amounts have increased:
- Single: from $12,150 to $12,450
- Married: from $27,150 to $27,750
- The values in the Single and Married Tax Tables (Step 6 of the Percentage Method) have been updated
- The values and thresholds used to calculate the standard deduction (Step 3 of the Percentage Method) have been updated
- The supplemental rate remains 5% and the nonresident alien rate remains 5%
https://www.maine.gov/revenue/tax-return-forms/employment-tax-returns-2026
Massachusetts
Massachusetts Paid Family and Medical Leave wage base increased
Effective January 1, 2026, the Massachusetts Paid Family and Medical Leave wage base increased from $176,100 to $184,500.
https://calculator.eol.mass.gov/pfml/contribution/
https://www.ssa.gov/news/en/cola/factsheets/2026.html
Minnesota
Minnesota Paid Leave wage base increased
Effective January 1, 2026, the Minnesota Paid Leave wage base increased to $184,500.
https://www.ssa.gov/oact/cola/cbb.html
https://mn.gov/deed/paidleave/employers/
Missouri
Missouri State Unemployment Tax wage base decreased
Effective January 01, 2026, the Missouri State Unemployment Tax wage base decreased from $9,500 to $9,000.
https://labor.mo.gov/des/employers/tax-rates
New Jersey
New Jersey Family Leave Insurance wage base increased
Effective January 1, 2026, the New Jersey Family Leave Insurance wage base increased from $165,400 to $171,100.
https://www.nj.gov/labor/ea/employer-services/rate-info/
New Jersey SDI wage base increased
Effective January 1, 2026, the New Jersey SDI rate decreased from 0.23% to 0.19%. Additionally, the wage base increased from $165,400 to $171,100.
https://www.nj.gov/labor/ea/employer-services/rate-info/
New York
New York Paid Family Leave Insurance rate and wage base increase
Effective January 1, 2026, the New York Paid Family Leave Insurance rate increased from 0.388% to 0.432%. Additionally, the wage base increased from $91,373.88 to $95,348.76
https://paidfamilyleave.ny.gov/2026
Ohio
Bellefontaine City Tax no longer administered by RITA
Effective October 16, 2025, the Bellefontaine City Tax is no longer administered by RITA. Instead, it is now administered by the City of Bellefontaine. The engine tracks whether an Ohio local tax is administered by RITA and uses this information in certain credit calculations. The tax rate itself remains 1.6%.
https://www.ci.bellefontaine.oh.us/
https://www.ritaohio.com/municipalities/Home/MemberPage?id=087
Bowling Green City Tax updated
Effective January 1, 2026, the Bowling Green City Tax rate increased from 2% to 2.15%. Additionally, the credit limit changed from 1% to 1.075%. The credit remains 50%.
https://www.bgohio.gov/208/Income-Tax-Division
Christ-Children's JEDD II Tax wage base increased
Effective January 1, 2026, the Christ-Children's JEDD II Tax wage base increased from $136,396 to $140,488.
https://cheviot.org/tax-office/
Fort Recovery City Tax tax rate and credit limit update
Effective January 1, 2026, the Fort Recovery City Tax rate increased from 1% to 1.5%.
https://www.fortrecovery.org/tax
Harrison Greene JEDD IV Tax wage base increased
Effective January 1, 2026, the Harrison Greene JEDD IV Tax wage base increased from $132,525 to $136,501.
https://cheviot.org/tax-office/
McAlister's JEDD VI Tax wage base increased
Effective January 1, 2026, the McAlister's JEDD VI Tax wage base increased from $124,884 to $128,631.
https://cheviot.org/tax-office/
Mercy West JEDD III Tax wage base increased
Effective January 1, 2026, the Mercy West JEDD III Tax wage base increased from $106,189 to $109,375.
https://cheviot.org/tax-office/
UDF JEDD V Tax wage base increased
Effective January 1, 2026, the UDF JEDD V Tax wage base increased from $127,757 to $131,590.
https://cheviot.org/tax-office/
Trenton City Tax is now administered by RITA
Effective January 1, 2026, the Trenton City Tax is now administered by RITA. The engine tracks whether an Ohio local tax is administered by RITA and uses this information in certain credit calculations. The tax rate itself remains 1.5%.
https://www.ritaohio.com/municipalities/Home/MemberPage?id=746
Walbridge City Tax credit updated
Effective January 1, 2026, the Walbridge City Tax credit limit decreased from 1% to 0.5%.
https://www.walbridgeohio.org/tax-forms
Washington Court House City Tax rate updated
Effective January 1, 2026, the Washington Court House City Tax rate decreased from 1.95% to 1.75%. Additionally, the credit limit was updated to 1.75%. The tax credit remains 50%.
https://www.cityofwch.com/183/Tax-Department
Western Ridge JEDD I Tax wage base increased
Effective January 1, 2026, the Western Ridge JEDD I Tax wage base increased from $143,991 to $148,311.
https://cheviot.org/tax-office/
Oklahoma
Oklahoma State Unemployment Tax wage base decreased
Effective January 01, 2026, the Oklahoma State Unemployment Tax wage base decreased from $28,200 to $25,000.
https://oklahoma.gov/oesc/employers/tax/contribution-rates.html
Oklahoma Technology Fund wage base decreased
Effective January 01, 2026, the Oklahoma Technology Fund wage base decreased from $28,200 to $25,000.
https://oklahoma.gov/oesc/employers/tax/contribution-rates.html
Oregon
Oregon Transit Tax updated
Effective January 1, 2026, the Oregon Transit Tax rate increased from 0.1% to 0.2%.
https://www.oregon.gov/DOR/programs/businesses/Pages/statewide-transit-tax.aspx
Workers' Benefit Fund Assessment - Employee rate updated
Effective January 1, 2026, the Workers' Benefit Fund Assessment - Employee rate will decrease from $0.01 to $0.009 per hour worked.
https://www.oregon.gov/dcbs/reports/cost/Pages/index.aspx
South Carolina
South Carolina State Tax updated
Effective 1 January 2026, the South Carolina State Tax has been updated:
- The South Carolina tax brackets have been updated, and the highest rate has decreased from 6.2% to 6.0%
- The supplemental wage rate has decreased from 6.2% to 6.0%
- The value of an annual personal allowance has increased from $4,860 to $5,000
- The maximum standard deduction amount has increased from $7,300 to $7,500
https://dor.sc.gov/withholding
Vermont
Vermont State Unemployment Tax wage base increased
Effective January 1, 2026, the Vermont State Unemployment Tax wage base increased from $14,800 to $15,400.
VT CCC no longer calculated prior to effective date
Vermont Child Care Contribution tax will no longer be returned for payroll calculations prior to the July 1, 2024 effective date. Previously, a $0 calculation was returned when this tax was set up within a payroll calculation.
Washington
Washington Paid Family & Medical Leave updated
Effective January 1, 2026, the Washington Paid Family & Medical Leave total premium rate will increase from 0.92% to 1.13%. The employee portion will decrease from 71.52% to 71.43% and the employer portion will increase from 28.48% to 28.57%. The employer can optionally elect to cover all or some of the employee's portion. The wage base will also increase from $176,100 to $184,500.
https://paidleave.wa.gov/updates/
https://www.ssa.gov/oact/cola/cbb.html
Shapefile Updates
Kentucky
Grace Commercial Park TIF shapefile added
The new Grace Commercial Park TIF shapefile has been added to the engine. The tax was implemented in the 2025.10.1 release.
Washington Workmans Comp (SDI)
Our Calculation Engine has been updated to support Washington workers’ compensation. It will use the hourly rates for different risk categories to calculate the Washington SDI.
Value
Ensures Compliance with State Regulations: Organizations need to accurately calculate and pay Washington’s workers’ compensation (and SDI) to remain compliant. Having these calculations built into the engine helps avoid manual errors or oversight.
Audience
Administrators
Examples
N/A
Items Removed from [Enhancement 1]
N/A
Secure 2.0 Section 603
Section 603 of the SECURE 2.0 Act of 2022 generally requires that catch-up contributions to employer-sponsored retirement plans (like 401(k), 403(b), and governmental 457(b) plans) must be made on an after-tax Roth basis for participants whose prior year's wages exceeded a certain threshold.
- Mandatory Roth: For participants aged 50 or older who earned more than $145,000 in FICA wages in the preceding calendar year (this amount is indexed for inflation), any catch-up contributions must be designated as Roth contributions.
- Effective Date: This requirement is effective for taxable years beginning after December 31, 2025. The IRS provided an administrative transition period for the years 2024 and 2025 due to implementation challenges.
We have updated the calculations to impose a Mandatory Roth Catch-Up restriction for 401(k), 403(b), and 457 plans as follows:
- The employee’s prior-year FICA year-to-date wage (PC usage 6202) is retrieved.
- This amount is compared to the Mandatory Roth Catch-Up prior-year FICA Wage Base Limit.
- If the catch-up option is elected for the 401(k), 403(b), or 457 plans, and the prior-year FICA YTD wage exceeds the Mandatory Roth Catch-Up prior-year FICA Wage Base Limit, then the catch-up is disallowed for those plans, and a warning appears in the UPCALC report.
Note: This limit will not apply to 457 Pre-Retirement Catchup Plans.
Value
This ensures contributions are aligned with new Roth catch-up requirements, reducing the risk of non-compliance and potential penalties.
Audience
Administrators
Examples
N/A
Items Removed from [Enhancement 1]
N/A
Year End Form Changes
We will continue to provide year-end form updates to support W-2/W-2c and Affordable Care Act reporting.
Value
Ensures Compliance: Keeps organizations aligned with the latest federal and state requirements, reducing the risk of fines and penalties.
Audience
Administrators
Examples
N/A
Items Removed from [Enhancement 1]
N/A
Appendix: Bugs Resolved
Functional
| Scenario When Issue Encountered | Issue Resolved |
| We have updated the Payroll Compliance Hub for workers’ W-2 forms to display box 13 and box 14, giving administrators immediate access to all information reported on the employee’s W-2 directly from the page. | Making box 13 and box 14 visible in the Payroll Compliance Hub gives administrators immediate access to crucial W-2 data, eliminating the need for cross-referencing or manual workarounds. |
| We fixed the vendor check alignment to match paychecks, ensuring the name and address are visible in the envelope window. Previously, the name and address were not displayed. | Ensuring the vendor check alignment matches the paycheck layout guarantees that the name and address are correctly displayed in the window envelope. This saves time, reduces errors, and improves overall efficiency by eliminating manual adjustments or rework when mailing checks. |
| We fixed an issue where employees, upon updating their tax withholding in Employee Self Service, would see FICA/Medicare/FUTA exemption fields in the confirmation window. Since these fields are not user-editable, they will no longer appear on the “Confirmed Changes” modal popup. | Employees will no longer see the exemption status for FICA/Medicare or FUTA. |
| We fixed an issue that caused an error when reordering employees’ direct deposits via drag-and-drop. | You can now reorder the deposits without encountering this error. |
| We updated the wording for North Dakota employee tax withholding filing status options to align with Federal standards and other states that follow the same approach. | North Dakota follows the Federal Withholding form. Now the wording is consistent with the Federal Form. |
| We resolved an issue where employees designated as FICA, FUTA, or Medicare exempt would lose their exemption status when making a withholding change in Employee Self Service. | Changing withholding order information in Employee Self Service will have no impact on the FICA, FUTA or Medicare Exemption. |