What Is FICA Tax?

FICA stands for the Federal Insurance Contributions Act. It's the mandatory payroll tax that funds two of America's largest social programs: Social Security and Medicare. If you've ever looked at your pay stub and wondered what "OASDI" or "SS Tax" and "Med Tax" mean — that's FICA.

Unlike federal income tax, which changes with brackets and deductions, FICA follows a simpler payroll structure. Most employees see it withheld automatically from each paycheck.

How to Read FICA Without Mixing It Up With Income Tax

FICA is easier to understand when you separate it from the rest of the paycheck:

• It is payroll tax, not income tax: FICA does not use the same bracket logic as federal income tax.
• Most of it is flat: for most workers, the employee share is a straightforward 7.65% until the Social Security wage base changes the pattern.
• It is tied to wages, not deductions: standard deduction, itemizing, or most income-tax strategies do not reduce regular employee FICA in the same way they affect federal taxable income.

FICA Tax Rates for 2026

How Much FICA Do You Actually Pay?

Here's how FICA plays out at different income levels in 2026:

How Your FICA Dollars Flow

Every dollar of FICA you pay is split between two programs and matched by your employer:

Social Security Tax: How It Works

The Social Security portion of FICA (6.2%) funds retirement, disability, and survivor benefits. It only applies to wages up to the Social Security wage base — $184,500 in 2026. Once your earnings exceed this threshold, no more Social Security tax is withheld for the rest of the year.

This is why high earners see their FICA withholding drop mid-year — they've hit the wage base cap. The wage base increases most years to keep pace with average wage growth.

Medicare Tax: How It Works

The Medicare portion (1.45%) funds health coverage for Americans 65 and older, and certain disabled individuals. Unlike Social Security, Medicare has no wage cap — you pay 1.45% on every dollar you earn.

High earners face an additional 0.9% Medicare surtax on wages above:

• $200,000 for single filers
• $250,000 for married filing jointly
• $125,000 for married filing separately

Employers withhold this additional 0.9% once your wages exceed $200,000 — regardless of your filing status. You may owe more (or receive a refund) when you file your annual return.

What Usually Changes Your FICA Number

FICA is simpler than income tax, but a few things still change what you see withheld:

• Your wage level: higher earnings raise Medicare withholding and can eventually cap Social Security withholding once you pass the wage base.
• Employee vs self-employed status: self-employed workers cover both halves through self-employment tax.
• Supplemental compensation: bonuses and large payroll spikes can make FICA feel heavier in a given pay period because the withholding is wage-based.
• Specific exemption rules: only a narrow set of student, visa, religious, or alternative-pension situations qualify for different treatment.

FICA for Self-Employed Workers

If you're self-employed, you pay self-employment tax instead of FICA — but it covers the same programs at the same rates. The key difference: you pay both the employee and employer portions yourself.

The deduction partially offsets the higher rate. On $75,000 of self-employment income, you'd pay ~$10,597 in SE tax but deduct ~$5,299 from taxable income.

Who Is Exempt From FICA?

Most US workers must pay FICA, but limited exemptions exist for:

• Certain religious groups — members of recognized sects that oppose insurance (must file IRS Form 4029)
• Some nonresident aliens — on specific visa types (F-1, J-1, M-1, Q-1 student visas)
• Certain student employees — working for their own college or university
• Some government workers — covered by alternative pension systems

FICA vs Federal Income Tax: Key Differences

FICA Tax Questions Answered