2007 Update        Massachusetts Health Insurance Reform Act In April of 2006  Massachusetts enacted a groundbreaking insurance reform act. Although most of the changes will not take effect until July, there are two important reforms that will take effect on January 1, 2007. Employers must convert to a 125 health plan if they are offering health insurance. All employers must comply with non discrimination guidelines which means they must offer the same health plan that they offer any other full time employees, including owners of S Corps., officers, stockholders and highly compensated employees. They must now contribute equally through payroll deductions to the plan.  Dependent health insurance coverage is extended through the age of 25 (until the day before their 26th birthday) or up to 2 years after the loss of IRS code dependent status, whichever comes first. Massachusetts Minimum Wage Increase The state of Massachusetts will be increasing it’s minimum wage rate from the current $6.75 per hour to $7.50 per hour in January 2007 and to $8.00 per hour in January 2008.   Social Security Base Increase   For 2007, the maximum wage base for social security deductions jumps to $97,500, an increase of $3,300 over the 2006 max of $94,200.   Mileage Rate The standard mileage rate is $.485 per business mile for 2007.   Retirement Plan Contributions For 2007, you can contribute up to $15,500 into a 401(k) or 403(b) plan through salary deferrals.  Anyone 50 or older by December 31, 2007 can contribute an extra $5,000 into their 401(k) or 403(b) plan through salary deferrals, for a total annual contribution of $20,500, or $1,708.33 per month.    For 2007, the maximum contribution into your SIMPLE is $10,500, or $875.00 per month.  Anyone 50 or older by December 31st can sock away an additional $2,500 in 2007, for a total annual contribution of $13,000, or $1,083.33 per month.