What Is FICA Tax

By the Between the News desk · researched with AI tools, checked and edited by a human editor

Total FICA rate: 15.3%, split evenly between employer and employeeEmployee share: 6.2% Social Security + 1.45% Medicare, or 7.65% totalThe Social Security portion has an annual wage cap; Medicare doesn'tAn additional 0.9% Medicare tax applies above $200,000 in wagesSource: irs.gov Topic 751

👁Decoded

FICA — the Federal Insurance Contributions Act — is the payroll tax line on every paycheck that funds Social Security and Medicare. It's not one tax but two combined into a single deduction, and it's split between you and your employer.

The total rate is 15.3% of wages, and it's divided equally: your employer pays half, you pay half. Your share as an employee breaks down to 6.2% for Social Security and 1.45% for Medicare, for a combined 7.65% taken out of every paycheck. Your employer matches that same 7.65% separately, on top of your gross pay — it's not deducted from what you see on your pay stub.

The two pieces behave differently at high incomes. Social Security tax only applies up to an annual wage cap that adjusts each year — earn above that cap, and you stop paying Social Security tax on the excess for the rest of the year. Medicare tax has no cap at all; it applies to every dollar you earn, no matter how high your income climbs.

High earners actually pay more than the standard rate on the Medicare side. An Additional Medicare Tax of 0.9% kicks in on wages above $200,000 in a calendar year — and unlike the standard Medicare tax, employers don't match this additional portion; it's entirely on the employee.

Self-employed workers pay both halves themselves through a separate but related tax called SECA, since there's no employer to split the cost with — which is part of why self-employment tax often comes as a surprise to people transitioning from a traditional paycheck.

“Self-employed workers pay both the employee AND employer share of FICA — there's no employer around to split the bill with.”