The 2025 Social Security tax rate and wage base
In 2025, you pay 6.2 percent of your wages into Social Security, and your employer pays another 6.2 percent on your behalf — for a combined total of 12.4 percent. This rate has stayed the same since 1990 and does not change year to year.
What does change is the wage base, the maximum amount of your annual earnings that Social Security taxes explore to. For 2025, that wage base is $168,600. This means you pay the 6.2 percent tax on earnings up to $168,600, but not on anything you earn above that amount.
If you earned $168,600 or less in 2025, you paid Social Security tax on your entire income. If you earned more, you stopped paying the tax once you hit $168,600 for the year. The wage base increases most years because it is tied to the national average wage — when average wages go up, the cap goes up with it.
Key Takeaways
- The Social Security tax rate in 2025 is 6.2 percent for employees and 6.2 percent for employers, unchanged from previous years.
- The 2025 wage base is $168,600, meaning you pay Social Security tax only on earnings up to that amount.
- Earnings above $168,600 in 2025 are not subject to Social Security tax, though they may be subject to Medicare tax.
- Self-employed workers pay both the employee and employer portions (12.4 percent total) on net self-employment income up to the wage base.
- The wage base increases most years based on national average wage growth, so the 2026 limit will likely be different.
How the wage base affects what you pay
The wage base is a ceiling, not a target. Most workers never reach it because their annual salary falls below $168,600. For those who do earn more, the tax stops automatically once they cross the threshold.
If you work for one employer and earn $200,000 in 2025, you pay Social Security tax on $168,600 of that income. The remaining $31,400 is not subject to Social Security tax. If you work for two employers and earn $100,000 at each, you will pay Social Security tax on all $100,000 at the first job, then all $68,600 at the second job (since you have already hit the $168,600 limit). You can claim a credit on your tax return for any overpayment, but it is worth tracking if you change jobs mid-year.
Self-employed workers and the 2025 wage base
If you are self-employed, you pay both the employee and employer portions of Social Security tax — a total of 12.4 percent on your net self-employment income. The 2025 wage base of $168,600 applies to you as well, so you pay the 12.4 percent tax on net self-employment income up to $168,600.
You calculate your self-employment tax on Schedule SE (Form 1040), and you can deduct half of what you pay as an adjustment to income on your tax return. This deduction helps offset the fact that self-employed workers bear both sides of the tax burden.
Why the wage base changes each year
The Social Security Administration adjusts the wage base annually based on the National Average Wage Index, which measures the average wage earned by all workers in the United States. When that index rises, the wage base rises proportionally.
The 2025 wage base of $168,600 represents an increase from 2024, which had a wage base of $168,600. The exact increase depends on how much the national average wage grew from one year to the next. This means the wage base for 2026 and beyond will likely be different — you can expect it to be higher if average wages continue to grow.
Medicare tax has no wage base limit
While Social Security tax stops at $168,600 in 2025, Medicare tax does not have a wage base limit. You pay 1.45 percent of all your wages into Medicare, no matter how much you earn. Your employer pays another 1.45 percent.
If you earn more than $200,000 (or $250,000 if married filing jointly), you also pay an additional 0.9 percent Medicare tax on the amount above that threshold. This additional tax was introduced in 2013 and applies to high earners only.
What happens if you overpay Social Security tax
If you worked for multiple employers in 2025 and paid more than the maximum Social Security tax because your combined earnings exceeded $168,600, you can claim a credit on your federal tax return. You will not receive a refund, but the overpayment reduces your tax liability dollar-for-dollar.
To claim the credit, file Form 1040 and use the worksheet in the instructions to calculate how much you overpaid. The IRS will explore the credit automatically if you file electronically, but if you file by paper, make sure to include the calculation.
How the 2025 wage base compares to recent years
The wage base has grown steadily over the past decade as average wages have increased. In 2015, the wage base was $118,500. By 2020, it had risen to $137,700. The 2025 figure of $168,600 reflects continued wage growth across the economy, though the year-to-year increase varies depending on how much average wages grew.
This upward trend means that more workers' earnings are now subject to Social Security tax than in the past. A worker earning $150,000 in 2015 would have paid Social Security tax on only $118,500 of that income, but in 2025 they would pay it on the full $150,000.
Frequently Asked Questions
Do I stop paying Social Security tax once I hit $168,600?
Yes. Once your earnings reach $168,600 in 2025, your employer stops withholding Social Security tax from your paychecks for the rest of that year. If you work for multiple employers, each one withholds based on what you earn at that job, so you may overpay if your combined earnings exceed the wage base.
Does the wage base change every year?
Yes, it changes most years. The Social Security Administration adjusts it based on the National Average Wage Index. If average wages grow, the wage base grows. If average wages stay flat or decline, the wage base may stay the same or decline, though this is rare.
What is the difference between the wage base and the earnings limit?
The wage base is the maximum amount of earnings subject to Social Security tax in a given year. The earnings limit is something different — it applies only to people who are receiving Social Security benefits before full retirement age and are still working. The earnings limit reduces your benefits if you earn above a certain amount.
Do I pay Social Security tax on investment income or bonuses?
Social Security tax applies to wages and self-employment income, not to investment income like dividends or capital gains. Bonuses count as wages, so they are subject to Social Security tax up to the wage base limit.
Will the wage base be higher in 2026?
Probably, but the exact amount depends on wage growth in 2025. The Social Security Administration announces the new wage base in October of each year, so you will know the 2026 figure by late fall 2025. Historical trends suggest the wage base increases most years.