What FICA tax rates apply in 2024

FICA tax has two parts: Social Security and Medicare. In 2024, you pay 6.2% of your wages to Social Security and 1.45% to Medicare, for a combined 7.65%. Your employer matches these amounts. If you are self-employed, you pay both the employee and employer portions — 12.4% for Social Security and 2.9% for Medicare, totaling 15.3%.

These rates have stayed the same since 2013. What changes year to year is the wage base — the maximum amount of income subject to Social Security tax. In 2024, that limit is $168,600. Once your wages hit that amount, you stop paying Social Security tax for the rest of the year. Medicare tax has no wage cap and applies to all earnings.

If you earn over $200,000 as a single filer (or $250,000 married filing jointly), you also owe an additional 0.9% Medicare tax on the excess. This extra tax has no employer match and applies to both W-2 wages and self-employment income.

Key Takeaways

  • Employee FICA tax is 7.65% total: 6.2% for Social Security and 1.45% for Medicare, withheld from your paycheck.
  • Self-employed workers pay 15.3% total because they cover both the employee and employer share.
  • Social Security tax only applies to the first $168,600 of wages in 2024; Medicare tax applies to all earnings with no cap.
  • An additional 0.9% Medicare tax applies to wages over $200,000 (single) or $250,000 (married filing jointly).
  • Your employer withholds FICA tax automatically from your paycheck; self-employed workers pay quarterly estimated tax or settle at tax time.

How FICA withholding works on your paycheck

Your employer calculates FICA tax on each paycheck and withholds it before you receive your pay. The amount depends on your gross wages — the total before any deductions. If you earn $2,000 in a pay period, your employer withholds $153 in FICA tax ($2,000 × 0.0765), plus your employer contributes another $153.

The withholding happens automatically based on your W-4 form, which you fill out when you start a job. Your W-4 does not affect FICA withholding — FICA comes out regardless. The W-4 only controls federal income tax withholding, which is separate.

If you have multiple jobs, FICA tax is withheld from each paycheck independently. This can mean you pay more Social Security tax than required if your combined wages exceed $168,600. You can claim a credit for the overpayment when you file your tax return, but you will not get the money back until then.

Self-employment FICA tax and quarterly payments

If you are self-employed, you pay FICA tax through self-employment tax on your net business income. The rate is 15.3% — double the employee rate because you cover both sides. You calculate this on Schedule SE and pay it when you file your tax return, or you can make quarterly estimated tax payments.

Quarterly estimated tax is due on April 15, June 17, September 16, and January 16 of the following year. You estimate your annual income and pay one-quarter of your total tax liability each quarter. If you underpay, you may owe a penalty when you file. If you overpay, you get a refund or credit toward next year's taxes.

You can deduct half of your self-employment tax from your income before calculating federal income tax, which provides some relief. The Social Security wage base limit ($168,600 in 2024) still applies — once your net self-employment income reaches that amount, you stop paying the 12.4% Social Security portion but continue paying 2.9% Medicare tax on all remaining income.

FICA tax on different types of income

FICA tax applies to W-2 wages from an employer and to net self-employment income. It does not apply to investment income, interest, dividends, capital gains, or rental income. It also does not apply to certain types of compensation like health insurance premiums paid by your employer, contributions to a 401(k) or traditional IRA, or dependent care benefits up to $5,000 per year.

Some income is subject to FICA even though it is not a W-2 wage. Tips are subject to FICA tax — your employer withholds it, or you report it on your tax return. Bonuses, commissions, and severance pay are all subject to FICA. Sick pay and vacation pay count as wages for FICA purposes.

Certain groups are exempt from FICA tax. Students employed by their school, some religious sect members, and certain government employees may not pay FICA. If you think you fall into an exempt category, check with your employer or a tax professional, because the rules are narrow and specific.

What happens when you reach the Social Security wage base

Once your cumulative wages hit $168,600 in 2024, your employer stops withholding Social Security tax (6.2%) from your paychecks for the rest of the year. Medicare tax (1.45%) continues on all wages with no limit. This is why people with high incomes pay a smaller percentage of their total earnings in FICA tax than lower-income workers.

If you change jobs mid-year, each employer withholds Social Security tax independently until they reach the wage base. This can result in overpayment. For example, if you earned $100,000 at Job A and then $80,000 at Job B, you would pay Social Security tax on both amounts even though your combined income is $180,000. You would overpay by $1,612 (6.2% of the $26,000 over the limit). Claim this overpayment as a credit on your tax return.

The wage base increases most years based on average wage growth. The Social Security Administration announces the new limit in October for the following year. Check the current limit each January to know when you will stop paying Social Security tax.

Additional Medicare tax for high earners

If your wages exceed $200,000 (single filer), $250,000 (married filing jointly), or $125,000 (married filing separately), you owe an additional 0.9% Medicare tax on the excess. This tax has been in place since 2013 and is separate from the standard 1.45% Medicare tax.

Your employer withholds this additional tax automatically once your wages cross the threshold. Unlike Social Security tax, there is no wage base limit — the additional Medicare tax applies to all earnings above the threshold. If you are self-employed, you calculate and pay this tax on Schedule SE along with your regular self-employment tax.

The income thresholds for additional Medicare tax do not adjust for inflation, so more workers become subject to it each year as wages rise. If you are close to the threshold, factor this into your tax planning.

How to verify your FICA tax withholding

Check your pay stub each pay period to confirm FICA tax is being withheld correctly. Your pay stub shows gross pay, FICA withholding (broken down by Social Security and Medicare), and net pay. Multiply your gross pay by 0.0765 to verify the total FICA amount is correct.

At the end of the year, your employer sends you a W-2 form showing total wages, total FICA tax withheld, and other tax information. Box 4 shows Social Security tax withheld; Box 6 shows Medicare tax withheld. Compare these to your pay stubs to catch any errors. If the amounts do not match, contact your employer's payroll department.

If you are self-employed, keep records of your income and expenses throughout the year. When you file your tax return, calculate self-employment tax on Schedule SE. The IRS provides worksheets and instructions with the form. If you are unsure about your calculations, a tax professional can review your records and ensure you are paying the correct amount.

Frequently Asked Questions

Can I avoid paying FICA tax?

No. FICA tax is mandatory for all employees and self-employed people with income above certain thresholds. A few narrow exemptions exist — some religious sect members, certain government employees, and students working for their school — but these require specific conditions and documentation. Most workers cannot avoid FICA tax.

What is the difference between FICA tax and federal income tax?

FICA tax funds Social Security and Medicare and has fixed rates (7.65% for employees). Federal income tax funds general government operations and varies based on your income, filing status, and deductions. Both are withheld from your paycheck, but they are separate taxes with different purposes and rates.

Do I pay FICA tax on my 401(k) contributions?

No. Contributions to a traditional 401(k) reduce your taxable income for federal income tax purposes, but FICA tax is still withheld on your gross pay before the 401(k) deduction. Roth 401(k) contributions are made after FICA tax, so FICA still applies to your total wages.

What if I overpaid Social Security tax because I had multiple jobs?

You can claim a credit for the overpayment on your tax return. The overpayment occurs when your combined wages from all jobs exceed $168,600. File your return and claim the excess as a credit against your federal income tax liability, or receive it as a refund if you have no other tax owed.

Do gig workers and contractors pay FICA tax?

Yes, as self-employed income. If you receive a 1099 form from a client, you owe self-employment tax (15.3%) on your net income. You calculate this on Schedule SE and pay it quarterly or when you file your return. Keep detailed records of income and business expenses to reduce your taxable self-employment income.