FICA tax rates are fixed by federal law and take the same percentage from every worker's paycheck

FICA taxes consist of two parts: Social Security and Medicare. Social Security takes 6.2% of your wages, and Medicare takes 1.45%. If you are self-employed, you pay both the employee and employer portions, which doubles the rate to 12.4% for Social Security and 2.9% for Medicare. These percentages do not change based on how much you earn or where you live — they are the same for all workers covered by FICA.

Your employer withholds these amounts from your paycheck and sends them to the federal government. You see the deduction listed on your pay stub as "Social Security" and "Medicare" or sometimes as "OASDI" (Old-Age, Survivors, and Disability Insurance) for Social Security. The money comes out before you receive your net pay.

There is a wage cap on Social Security tax only. In 2024, you stop paying Social Security tax once your wages reach $168,600 for the year. Medicare tax has no cap — you pay 1.45% on all wages no matter how high your income goes. High earners also pay an additional 0.9% Medicare tax on wages above $200,000 (single filers) or $250,000 (married filing jointly), bringing their total Medicare rate to 2.35%.

Key Takeaways

  • Social Security tax is 6.2% of your wages; Medicare tax is 1.45%, for a combined FICA rate of 7.65% that your employer withholds from your paycheck.
  • Self-employed workers pay 15.3% total because they cover both the employee and employer portions of FICA tax.
  • Social Security tax stops once you earn $168,600 in a calendar year, but Medicare tax continues on all wages with no upper limit.
  • High earners pay an extra 0.9% Medicare tax on wages above $200,000 (single) or $250,000 (married filing jointly).

How the Social Security portion works

Social Security tax funds retirement, disability, and survivor benefits. The 6.2% rate has been in place since 1990 and applies to all wages up to the annual cap. Once you reach the cap in a given year, your employer stops withholding Social Security tax from the rest of your paychecks for that year.

If you work for multiple employers in the same year, each one withholds 6.2% independently. You may end up paying more than the annual cap requires. When this happens, you can claim the overpayment as a credit on your federal tax return (Form 1040) when you file, and the IRS will refund the excess.

The wage cap changes each year based on inflation. The Social Security Administration announces the new cap in October for the following year. This means the dollar amount you stop paying at shifts annually, though the 6.2% rate stays the same.

How the Medicare portion works

Medicare tax funds hospital insurance (Part A) and is withheld at 1.45% on all your wages with no annual cap. Unlike Social Security, there is no wage limit — you pay Medicare tax on every dollar you earn, whether you make $30,000 or $300,000 in a year.

The additional 0.9% Medicare tax applies only to high earners and is withheld by your employer once your wages cross the threshold for your filing status. This extra tax was added in 2013 as part of the Affordable Care Act. It is separate from the standard 1.45% Medicare tax, so high earners pay 2.35% total on wages above the threshold.

Unlike the Social Security cap, the income thresholds for the additional Medicare tax do not adjust for inflation. They remain $200,000 (single), $250,000 (married filing jointly), and $125,000 (married filing separately) indefinitely.

What self-employed workers pay

If you are self-employed, you pay both the employee and employer share of FICA taxes. This means you pay 12.4% for Social Security (up to the wage cap) and 2.9% for Medicare, totaling 15.3% on net self-employment income. You calculate this on Schedule SE (Self-Employment Tax) when you file your tax return.

Self-employed workers can deduct half of their self-employment tax as an adjustment to income on their tax return, which reduces the effective cost slightly. However, you still owe the full 15.3% amount to the IRS. Many self-employed people make quarterly estimated tax payments to cover FICA and income tax throughout the year rather than paying a large amount at tax time.

The same wage cap and high-earner thresholds apply to self-employed income. Once your net self-employment income reaches the Social Security cap, you stop calculating the 12.4% portion. The 2.9% Medicare tax (or 3.8% if you are a high earner) continues on all remaining income.

How FICA taxes appear on your pay stub

Your pay stub shows FICA withholding in two or three line items. You will see "Social Security Tax" or "OASDI" at 6.2% of your gross pay, and "Medicare Tax" at 1.45%. If you are a high earner, there may be a third line for "Additional Medicare Tax" at 0.9%. These amounts are subtracted from your gross pay to arrive at your net pay (what you actually receive).

The year-to-date totals on your pay stub show how much you have paid in FICA taxes so far in the calendar year. This helps you track whether you are approaching the Social Security wage cap or the Medicare high-earner threshold. Once the Social Security withholding stops, you will notice that line disappear from future paychecks for that year.

Comparing FICA to other payroll taxes

FICA is separate from federal income tax withholding, which is calculated differently and based on your W-4 form. FICA is also separate from state and local income taxes, which vary by location. Some states do not have income tax at all, while others tax wages at rates ranging from less than 1% to over 13%.

FICA is a flat-rate tax with no deductions — it applies to all wages equally. Federal income tax, by contrast, uses a progressive system with different rates depending on your income level and filing status. This is why your pay stub may show a higher federal income tax withholding than FICA withholding, or vice versa, depending on your circumstances.

What happens to FICA taxes you pay

FICA taxes fund two separate trust funds: the Social Security trust fund and the Medicare trust fund. The money you pay in does not sit in an account with your name on it. Instead, current FICA taxes pay benefits to current retirees, disabled workers, and their families, as well as Medicare claims for current beneficiaries.

When you reach retirement age (between 62 and 70, depending on your birth year), you become may be able to access to receive Social Security retirement benefits based on your earnings record. The amount you receive depends on how much you earned and how long you paid FICA taxes, not on how much you personally paid in. Similarly, once you turn 65, you become may be able to access for Medicare, which is funded by the Medicare portion of FICA taxes you and others have paid.

Frequently Asked Questions

Do I pay FICA taxes on tips and bonuses?

Yes. FICA taxes apply to all wages, including tips, bonuses, commissions, and most other forms of compensation. Your employer withholds FICA on these amounts just as they do on your regular salary. Tips must be reported to your employer so they can withhold the correct amount.

What if I work part-time or have irregular income?

FICA taxes are withheld on every paycheck based on the wages you earn that period. If you earn $500 one week, FICA is calculated on $500. There is no minimum earnings threshold — FICA applies to all wages. If your income varies, your FICA withholding will also vary from paycheck to paycheck.

Can I opt out of paying FICA taxes?

No. FICA taxes are mandatory for all workers covered by Social Security and Medicare. The only exceptions are certain government employees hired before specific dates and some religious groups that have received exemptions. Most workers cannot avoid FICA withholding.

Do I get a refund if too much FICA was withheld?

You can get a refund only if you overpaid Social Security tax by working for multiple employers or changing jobs. Medicare tax overpayment is not refundable. Report the overpayment on your tax return, and the IRS will refund the excess Social Security tax you paid.

How do I know if I have paid enough to may have access to for benefits?

The Social Security Administration tracks your earnings record based on your Social Security number. You can create an account at ssa.gov to view your earnings history and see an estimate of your future benefits. You need 40 work credits (roughly 10 years of work) to may have access to for retirement benefits.