What is the FICA Tax?
FICA funds Social Security and Medicare. Employees pay 6.2% Social Security (up to the wage base of 176,100) and 1.45% Medicare on all wages, with the employer matching both.
Self-employed people pay both halves — 15.3% total — through self-employment tax, though half is deductible and only 92.35% of net earnings is subject to it.
An Additional Medicare Tax of 0.9% applies above 200,000 single or 250,000 married, with no employer match.
Formula & worked example
Self-employed: 12.4% + 2.9% on 92.35% of net earnings
Plus 0.9% Additional Medicare above threshold
Worked example: an employee earning 120,000 pays 7,440 Social Security and 1,740 Medicare — 9,180 total, or 7.65%. The employer pays another 9,180 on top, meaning 18,360 goes to FICA in total.
How to use this fica tax calculator
- Enter your annual wages or self-employment net earnings.
- Select employee or self-employed — the rate doubles for the latter.
- Choose your filing status for the Additional Medicare threshold.
- Note that Social Security stops at the wage base but Medicare never does.
Smart tips
- Social Security tax stops once you cross the wage base — take-home rises noticeably late in the year for high earners.
- Self-employed filers can deduct half of self-employment tax when computing adjusted gross income.
- FICA applies to wages and self-employment income, not to investment income, which faces the separate 3.8% NIIT.
- S-corporation owners pay FICA only on reasonable salary, not distributions — a common and legitimate planning point.
- FICA is not affected by deductions or credits; it applies to gross wages regardless of your income tax bill.
Frequently asked questions
What is FICA tax?
The payroll tax funding Social Security (6.2%) and Medicare (1.45%) for employees, matched by the employer.
Is there a cap on FICA?
Social Security stops at the annual wage base (176,100). Medicare has no cap and adds 0.9% above 200,000 single or 250,000 married.
How much FICA do the self-employed pay?
15.3% on 92.35% of net earnings, since they pay both employee and employer halves. Half is deductible.
Can I avoid FICA?
Not on wages. Investment income is not subject to FICA, and S-corp distributions above a reasonable salary are exempt.
Want the theory behind the numbers? Read our US payroll tax guides on the Money Blog.