FICA Tax Rate for 2025 to 2026: Everything You Need To Know

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FICA is a payroll tax that funds Social Security and Medicare. If you’re a W-2 employee, it’s automatically withheld from your paycheck. If you’re self-employed, you pay the equivalent yourself.

Here’s a clear breakdown of the FICA tax rate for 2025 and 2026, what you and your employer pay and how the wage base cap affects high earners.

FICA Tax Rate: At a Glance (2025-2026)

Tax Component	Total Rate	Employee Pays	Employer Pays	Income Cap
Social Security	12.4%	6.2%	6.2%	$176,100 (2025)/$184,500 (2026)
Medicare	2.9%	1.45%	1.45%	No cap
Additional Medicare	0.9%	0.9% (employee only)	0%	Over $200K single/$250K joint

Total FICA: 15.3% (7.65% employee + 7.65% employer)

What Does FICA Stand For?

FICA stands for the Federal Insurance Contributions Act, the 1935 law that established payroll taxes to fund Social Security retirement benefits, according to the Internal Revenue Service.

In 1965, Medicare was added to the program under President Lyndon B. Johnson’s Great Society reforms. Today, FICA funds:

• Social Security retirement, disability and survivor benefits
• Medicare hospital and medical coverage

Current FICA Tax Rates Explained

The total FICA rate remains 15.3% in both 2025 and 2026.

• 12.4% goes to Social Security
• 2.9% goes to Medicare

Employers and employees split this evenly:

• Employee: 7.65%
• Employer: 7.65%

Social Security Tax Rate and Wage Base

The Social Security portion is 6.2% for employees and 6.2% for employers, totaling 12.4%. However, it only applies up to the annual wage base limit, set each year by the Social Security Administration.

• 2025 wage base: $176,100
• 2026 wage base: $184,500

Income above those amounts is not subject to Social Security tax. This cap exists because Social Security benefits are also capped.

Medicare Tax Rate

Medicare tax is:

• 1.45% for employees
• 1.45% for employers
• No income limit

High earners pay an Additional Medicare Tax of 0.9% on wages above:

• $200,000 (single)
• $250,000 (married filing jointly)

Employers withhold this additional 0.9% once wages exceed $200,000, according to the Internal Revenue Service.

That means high earners pay:

• 2.35% Medicare tax on income above the threshold

How FICA Is Calculated on a Paycheck

Let’s say you earn $1,500 in gross wages.

Step 1: Social Security

$1,500 x 6.2% = $93

Step 2: Medicare

$1,500 x 1.45% = $21.75

Total employee FICA withholding: $114.75. Your employer also pays $114.75.

FICA for Self-Employed Workers

If you’re self-employed, you don’t have an employer splitting the tax. Instead, you pay self-employment tax, which equals the full 15.3%.

Breakdown:

• 12.4% Social Security (up to wage base)
• 2.9% Medicare
• +0.9% Additional Medicare for high earners

Why Self-Employed Workers Pay More

The IRS treats you as both employer and employee.

However, you can deduct half of your self-employment tax when calculating adjusted gross income. This reduces your income tax, but not your self-employment tax itself.

Does Everyone Pay the Same FICA Rate?

Most employees do. Exceptions include:

• High earners (Additional Medicare Tax)
• Some state and local government workers with alternative pension systems
• Certain nonresident aliens
• Members of qualifying religious groups (Form 4029)

Can You Reduce FICA Taxes?

Unlike income tax, FICA is based on gross wages, not taxable income.

That means:

• 401(k) contributions still reduce income tax
• But generally do NOT reduce Social Security or Medicare taxes

Exceptions:

• Employer HSA contributions are not subject to FICA
• S-corporation owners can reduce self-employment exposure by splitting salary and distributions (must pay reasonable salary)

Final Take To Go

For 2025 and 2026, the FICA tax rate remains:

• 7.65% for employees
• 15.3% for self-employed workers

The key updates to know:

• Social Security wage base rises to $184,500 in 2026
• Medicare has no income cap
• High earners pay an extra 0.9% Medicare tax

Understanding FICA helps you:

• Estimate take-home pay
• Plan for self-employment taxes
• Know when you’ve maxed out Social Security withholding

Daria Uhlig, Vance Cariaga and Cynthia Measom contributed to the reporting for this article.

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