How much you pay in Medicare and Social Security tax

Your employer withholds 6.2% of your gross pay for Social Security and 1.45% for Medicare. Your employer matches both amounts, so the total cost to them is double what you see on your pay stub. If you are self-employed, you pay both the employee and employer portions yourself — 12.4% for Social Security and 2.9% for Medicare — though you can deduct half of it on your tax return.

These are separate from federal income tax withholding. They appear as line items on your pay stub labeled FICA (Federal Insurance Contributions Act) or sometimes broken out as "Social Security" and "Medicare" or "HI" (Hospital Insurance).

There is no way to opt out of these taxes if you work. They fund Social Security retirement and disability benefits, and Medicare hospital insurance. The amounts are set by federal law and do not change based on your income level, though Social Security tax stops once you hit the annual wage base — in 2024 that limit is $168,600, meaning high earners stop paying Social Security tax partway through the year.

Key Takeaways

  • Social Security tax is 6.2% of your paycheck and Medicare tax is 1.45%, withheld automatically by your employer.
  • Self-employed workers pay both the employee and employer share: 12.4% for Social Security and 2.9% for Medicare.
  • Social Security tax has an annual wage cap (in 2024, earnings above $168,600 are not taxed), but Medicare tax does not.
  • These taxes fund Social Security retirement and disability benefits, and Medicare Part A hospital coverage.
  • You cannot opt out of these taxes if you work, and they appear separately from federal income tax on your pay stub.

Why the Social Security wage cap matters if you earn a high income

Once your earnings reach the annual wage base, your employer stops withholding Social Security tax for the rest of that year. In 2024, that threshold is $168,600. If you earn $200,000 in a year, you pay Social Security tax only on the first $168,600 of income.

This means high earners pay a smaller percentage of their total income in Social Security tax than lower earners do. A person earning $50,000 pays 6.2% on all of it. A person earning $500,000 pays 6.2% only on $168,600 and nothing on the remaining $331,400.

Medicare tax has no wage cap. You pay 1.45% on every dollar you earn, no matter how much you make. However, if your income exceeds certain thresholds — $200,000 for single filers, $250,000 for married filing jointly — you pay an additional 0.9% Medicare tax on the excess. This extra tax was added in 2013 as part of the Affordable Care Act.

What self-employed workers owe

If you are self-employed, you do not have an employer to split the tax burden with. You pay the full 15.3% yourself: 12.4% for Social Security and 2.9% for Medicare. This is called self-employment tax and is calculated on your net business income (your revenue minus business expenses).

You report self-employment tax on Schedule SE when you file your federal income tax return. The good news is that you can deduct half of what you pay — the employer-equivalent portion — as an adjustment to your income, which lowers your taxable income.

If you are a gig worker, freelancer, or contractor, you are responsible for setting aside money for these taxes throughout the year. Unlike W-2 employees, no one withholds it automatically. Many self-employed people make quarterly estimated tax payments to avoid a large bill at tax time.

How these taxes fund Social Security and Medicare

The money you pay in Social Security tax goes into a trust fund that pays out retirement benefits, survivor benefits (for your family if you die), and disability benefits. The program is not a savings account — your taxes pay current beneficiaries, and future workers' taxes will pay your benefits when you retire.

Medicare tax funds Part A, which covers hospital stays, skilled nursing care, hospice, and some home health services. It does not cover doctor visits (Part B) or prescription drugs (Part D), which have separate premiums you pay when you enroll.

Both programs have trust funds that are monitored by trustees. Social Security's trust fund is projected to be depleted around 2033 if no changes are made to the law, though benefits would continue at a reduced level from incoming tax revenue. Medicare's Hospital Insurance trust fund has a different timeline. Congress periodically adjusts tax rates or benefit structures to keep the programs solvent.

How to find your Medicare and Social Security tax on your pay stub

Look for a section labeled "Deductions" or "Taxes." You should see line items for "Social Security" or "FICA-SS" and "Medicare" or "FICA-HI." The amount withheld appears in a column next to the label, and year-to-date totals usually appear in another column so you can track how much you have paid so far.

If you work for multiple employers in the same year, each one withholds Social Security tax independently. This can cause you to overpay if your combined earnings exceed the wage base. When you file your tax return, you can claim a refund for the excess Social Security tax withheld.

Your W-2 form, which your employer sends you by January 31, shows the total Social Security and Medicare tax you paid during the year in boxes 4 and 6. These numbers should match what you see on your final pay stub for that year.

What happens if you do not pay these taxes

If you are an employee, you cannot avoid these taxes — your employer is required by law to withhold them. If you are self-employed and do not pay self-employment tax, the IRS will assess penalties and interest on the unpaid amount.

Failing to pay also affects your Social Security record. The IRS reports your earnings to Social Security, and those earnings determine how much you receive in retirement benefits. If you underreport income or do not pay self-employment tax, your future benefits will be lower because your earnings history will show less income.

Frequently Asked Questions

Can I get a refund of Medicare and Social Security tax?

You cannot get a refund of Social Security or Medicare tax that was correctly withheld. However, if you worked for multiple employers and your combined earnings exceeded the Social Security wage base, you may have overpaid Social Security tax. You can claim a refund for the overage when you file your federal income tax return.

Do I pay these taxes on tips?

Yes. Tips are considered wages for Social Security and Medicare tax purposes. Your employer should withhold these taxes on tips you report, or you can pay them when you file your return if they were not withheld. Unreported tips are not counted toward your earnings record.

What if I am a student or work part-time?

You pay Social Security and Medicare tax on all wages, regardless of how much you earn or how many hours you work. There is no minimum income threshold. The only exception is if you work for a school or university and are enrolled as a student — some student employees are exempt, but this varies by employer.

Do I pay these taxes on unemployment benefits or disability payments?

No. Unemployment benefits and Social Security Disability Insurance (SSDI) payments are not subject to Social Security or Medicare tax. However, they may be subject to federal income tax withholding if you request it.

How do I know if the amounts withheld are correct?

Check your pay stub against the tax rates: 6.2% for Social Security (up to the wage base) and 1.45% for Medicare. Multiply your gross pay by these percentages to verify the amounts. If the numbers do not match, contact your employer's payroll department to correct the error.