FICA and the Social Security wage base

For 2026, employees pay 6.2% of wages for Social Security and 1.45% for Medicare, 7.65% in all. Employers pay the same amounts again on top. The base is gross pay less a few exclusions, mainly section 125 benefits such as health premiums. A 401(k) deferral does not reduce it, which is why FICA wages on a W-2 are usually higher than income tax wages.

The wage base

Social Security applies only to the first $184,500 of wages in 2026. The Social Security Administration sets this figure each autumn from the national average wage index, and it rises most years. At the base, an employee’s Social Security for the year tops out at $11,439.00.

Medicare has no base. Every dollar of wages pays 1.45%, however high the salary.

The paycheck where Social Security stops

A salary of $300,000 paid every two weeks gives gross pay of $11,538.46 a paycheck. Each of the early paychecks withholds $715.38 of Social Security and $167.31 of Medicare.

By the end of paycheck 15, wages for the year are $173,076.90. Only $11,423.10 of room is left under the base, so paycheck 16 withholds $708.23 of Social Security, on that remainder only. From paycheck 17 on, Social Security is $0.00, and the take-home pay on each of the remaining 10 paychecks rises by the $715.38 that no longer comes out. Over the year the employee pays $11,438.93 of Social Security, the maximum give or take a few cents of rounding.

This bump misleads people in both directions. Budgets built on autumn paychecks overstate take-home pay, and the drop back in January looks like a pay cut. If you plan monthly spending from a paycheck, use one from early in the year.

Additional Medicare tax

On wages above $200,000 with one employer, payroll must withhold an extra 0.9% of Medicare. The $300,000 earner crosses that line in paycheck 18, and each later paycheck withholds $103.85 more. Over the year the surtax comes to $900.03, and total Medicare to $5,250.09. Employers do not pay a matching share of this part.

The withholding threshold and the tax threshold are not the same. The tax itself applies to wages above $200,000 for single filers, $250,000 for married couples filing jointly and $125,000 for married filing separately, and it is settled on Form 8959 with the return.

That gap matters for two-earner couples. Spouses earning $150,000 each have no Additional Medicare withheld, because neither employer pays either of them more than $200,000. Together they earn $300,000, and they owe $450 of Additional Medicare tax on the return. Adding that amount to Step 4(c) of one spouse’s W-4, spread over the year’s paychecks, avoids the surprise.

Two jobs, too much Social Security

Each employer withholds Social Security as if it were your only employer. Someone who earns $120,000 at one job and $100,000 at another in the same year has $7,440.00 and $6,200.00 withheld, $13,640.00 in all. The most an employee owes is $11,439.00.

The extra $2,201.00 is not refunded by either employer, and neither employer did anything wrong. You claim it as a credit on Schedule 3 of Form 1040, and it comes back as part of your refund or reduces what you owe. If both jobs were with the same company, or companies sharing a payroll as a common paymaster, the employer should have stopped at the base and must refund the excess itself.

Changing jobs mid-year has the same effect. The new employer starts the count from zero.

Self-employment tax is both halves

The self-employed pay the employee’s and the employer’s share together: 12.4% for Social Security and 2.9% for Medicare, applied to 92.35% of net profit. The reduction to 92.35% mirrors the fact that an employer’s half is not part of an employee’s wages.

On $80,000 of profit, self-employment tax is $11,304. An employee earning the same amount would see $6,120 on the pay stub. Half of the self-employment tax, $5,652, is deductible from income, which softens the gap a little. The Social Security part stops at the same wage base, and W-2 wages count toward it first, so someone with a salary and a side business pays Social Security on the business profit only until the two together reach $184,500.

Who does not pay FICA

A few groups are outside it, fully or partly:

• many state and local government employees covered by a public pension plan instead of Social Security;
• students working for the college they attend, during the school year;
• some nonresident visa holders, such as F-1 and J-1 students in their first years in the US;
• members of certain religious groups who have an approved exemption.

If you fall into one of these and see Social Security on your stub, ask payroll before the year ends. Corrections are simpler inside the same year.

Checking your own stub

Take the Social Security wages for the paycheck, multiply by the Social Security rate and compare. Do the same for Medicare. A difference of a cent is rounding. A larger difference usually means the wage base has been reached, a section 125 deduction has started or stopped, or the paycheck includes an item, such as a gift card or group-term life insurance over the tax-free amount, that is taxed but not paid in cash. The pay stub guide shows how to find each wage base on the stub.

Every figure on this page is computed by the same code as our calculators. How we calculate.