What Is FICA? Social Security & Medicare Explained
FICAstands for the Federal Insurance Contributions Act. It's the payroll tax that funds two federal programs: Social Security and Medicare. Unlike income tax, FICA is a flat percentage of your wages with no standard deduction — it comes out from the first dollar you earn.
The 2026 FICA rates
- Social Security: 6.2% of your wages, but only up to the annual wage base limit of $184,500 for 2026. Earnings above that are not subject to Social Security tax — so the most any employee pays in 2026 is about $11,439.
- Medicare: 1.45% of all your wages, with no upper limit.
Together that's 7.65% withheld from a typical paycheck. Your employer pays a matching 7.65% on your behalf (the self-employed pay both halves, 15.3%, as self-employment tax).
The Additional Medicare Tax
High earners pay an extra 0.9% Medicare tax on wages above $200,000 (single) or $250,000 (married filing jointly). This surtax applies only to the portion above the threshold, and the thresholds are set by law and not adjusted for inflation.
Why it matters for your paycheck
Because Social Security stops at the wage base, very high earners see their take-home percentage tick up slightly later in the year once they cross $184,500 — Social Security withholding stops while Medicare continues. For most people, though, FICA is a steady 7.65% bite on every paycheck that's easy to overlook when budgeting.
See exactly how FICA, federal, and state taxes hit your salary with the paycheck calculator, or read How U.S. paycheck taxes work.