Social Security and Medicare Taxes, Explained
Two lines on your pay stub almost never change: Social Security and Medicare. Together they're often called FICA taxes, after the law that created them. Here's how they work.
The rates
| Tax | Your share | Limit |
|---|---|---|
| Social Security | 6.2% | Only on the first $184,500 of wages in 2026 |
| Medicare | 1.45% | No limit |
| Additional Medicare | 0.9% more | Withheld on wages over $200,000 in a year |
For most people, that's 7.65% of every paycheck. On $1,000 of pay: $62 for Social Security and $14.50 for Medicare.
Your employer pays a matching 7.65% on top of your pay. You don't see it on your stub, but it's part of what your job costs them.
What's different about FICA
It isn't affected by your W-4. Your W-4 changes federal income tax withholding only. Social Security and Medicare are fixed percentages of pay.
There's no refund. Unlike income tax, FICA isn't an estimate that gets settled when you file. It's the tax itself. (One exception: if you had two employers and together they withheld Social Security on more than the yearly limit, you can get the extra back when you file.)
Some deductions lower it, some don't. Health insurance premiums taken through a cafeteria plan (Section 125) usually reduce the pay that FICA applies to. Traditional 401(k) contributions don't: they lower your income tax, but you still pay Social Security and Medicare on that money.
Overtime is taxed the same. Overtime pay counts as wages for FICA. Even the overtime tax deduction doesn't change that: it's an income tax deduction only.
The Social Security limit
Social Security stops once your wages for the year pass the limit ($184,500 in 2026). For a high earner, that means paychecks late in the year get noticeably bigger, then shrink again in January when the limit resets.
The limit applies per employer for withholding, but per person for the tax. That's why someone with two high-paying jobs can end up overpaying and get the difference back on their tax return.
What it pays for
- Social Security funds retirement, disability and survivor benefits. Your earnings record, built from these taxes, decides your future benefit.
- Medicare funds health coverage at 65 and for some people with disabilities.
You can see your earnings record and estimated benefits by creating an account at ssa.gov. It's worth checking that every year's wages were recorded correctly.
Planning with it
Because FICA is a fixed percentage, it's the most predictable part of your paycheck. When you plan around a raise or extra hours, count on 7.65% of the extra going to FICA, plus income tax at your bracket.
IncomeSync includes Social Security (with the yearly limit), Medicare and Additional Medicare in every projected paycheck, so the numbers match your stub.