FICA tax amounts depend on your income and employment status
FICA taxes are split between two parts: Social Security and Medicare. If you are a regular employee, your employer withholds both from your paycheck. The amount you pay is a percentage of your gross wages — the money before taxes come out.
For Social Security, you pay 6.2% of your wages up to a yearly cap. For Medicare, you pay 1.45% of all your wages with no cap. If you are self-employed, you pay both the employee and employer portions, which totals 15.3% for Social Security (up to the cap) and 2.9% for Medicare (no cap). These percentages do not change year to year, but the Social Security wage cap does.
The actual dollar amount you pay depends entirely on how much you earn. Someone making $30,000 a year pays less FICA than someone making $100,000 a year. The wage cap for Social Security means that very high earners stop paying the Social Security portion partway through the year, but they continue paying Medicare tax on every dollar.
Key Takeaways
- Employees pay 6.2% for Social Security (up to an annual wage cap) and 1.45% for Medicare (no cap) from each paycheck.
- Self-employed workers pay both the employee and employer share: 12.4% for Social Security (up to the cap) and 2.9% for Medicare (no cap).
- The Social Security wage cap changes each year and stops you from paying that tax once you reach it, but Medicare tax continues on all income.
- Your employer withholds FICA taxes automatically if you are an employee, but self-employed people must calculate and pay these taxes themselves.
Employee FICA withholding: what comes out of your paycheck
If you work for an employer, FICA taxes are deducted from your gross pay before you see your paycheck. Your employer sends these amounts to the IRS on your behalf. You do not have to calculate anything — the withholding happens automatically based on your wages.
The Social Security portion stops once you hit the yearly wage cap. In 2024, that cap was $168,600. If you earn $170,000 in a year, you pay the 6.2% Social Security tax only on the first $168,600 of income. The remaining $1,400 is not subject to Social Security tax, though it is still subject to Medicare tax. This means high earners pay less total FICA as a percentage of income than middle-income earners.
Medicare tax has no wage cap, so it applies to every dollar you earn no matter how much you make. If you earn $200,000, you pay 1.45% Medicare tax on the full $200,000.
Self-employed FICA: paying both sides of the tax
If you are self-employed, you pay FICA taxes as both the employee and the employer. This means your total rate is double: 12.4% for Social Security (up to the wage cap) and 2.9% for Medicare (no cap). You calculate these taxes yourself on your federal tax return using Schedule SE.
Self-employed people can deduct half of their self-employment tax when calculating their adjusted gross income, which provides some tax relief. However, you still owe the full amount. You typically pay these taxes quarterly through estimated tax payments, not through paycheck withholding.
The wage cap for self-employed Social Security tax is the same as for employees. In 2024, you paid 12.4% on net self-employment income up to $168,600, then 2.9% on all remaining income.
Additional Medicare tax for high earners
There is an extra Medicare tax that applies only to people who earn above certain thresholds. This Additional Medicare Tax is 0.9% and applies to wages above $200,000 for single filers, $250,000 for married couples filing jointly, and $125,000 for married couples filing separately.
Your employer withholds this tax automatically if your wages cross the threshold. If you are self-employed, you calculate it on your tax return. Unlike regular Medicare tax, this additional tax does not have a matching employer portion for self-employed people — you pay only the employee side.
How the Social Security wage cap works each year
The Social Security wage cap is adjusted annually based on changes in average wages in the United States. The cap increases most years, though the amount of the increase varies. This means the dollar amount you stop paying Social Security tax changes from year to year.
If you change jobs during the year, each employer withholds Social Security tax independently. If your combined wages from multiple employers exceed the cap, you may have overpaid Social Security tax. You can claim a refund of the overpayment when you file your federal tax return.
The Medicare tax rate and the Additional Medicare Tax threshold do not change annually the way the Social Security cap does. Medicare tax applies to all wages with no cap, and the Additional Medicare Tax threshold has remained the same since it was introduced in 2013.
FICA taxes and your pay stub
Your pay stub shows FICA taxes as separate line items. You will see "Social Security Tax" or "OASDI" (Old-Age, Survivors, and Disability Insurance) and "Medicare Tax" listed with the amounts withheld. These appear in the deductions section, along with federal and state income tax withholding.
The amounts on your pay stub tell you exactly how much FICA tax your employer is sending to the IRS on your behalf. Over the course of a year, these deductions add up to your total FICA contribution. This information is also reported on your W-2 form at the end of the year in boxes 4 and 6 for Social Security and Medicare respectively.
Frequently Asked Questions
What happens to FICA taxes I pay?
Social Security tax funds the Social Security retirement, disability, and survivor benefit programs. Medicare tax funds the Medicare hospital insurance program. These are not savings accounts in your name — the taxes you pay today fund benefits for current retirees and disabled workers, and future benefits are funded by future workers' taxes.
Can I opt out of paying FICA taxes?
No. FICA taxes are mandatory for all employees and self-employed people. Some religious groups have limited exemptions from self-employment tax, but these are rare and require IRS approval. If you are an employee, you cannot avoid FICA withholding.
Do I pay FICA taxes on all types of income?
FICA taxes explore to wages and self-employment income. They do not explore to investment income, interest, dividends, or capital gains. If you have both W-2 wages and self-employment income, you pay FICA on both, but the Social Security portion is capped at the yearly wage limit combined across all sources.
Why do I owe FICA taxes if I get a refund on my income tax return?
FICA taxes and income tax withholding are separate. You can owe FICA taxes while still receiving an income tax refund. This happens when your employer withholds more income tax than you owe, but FICA taxes are calculated independently and are not refundable.