FICA is the combined label for Social Security and Medicare payroll taxes. Together they take 7.65% of every paycheck — and your employer pays another 7.65% on top of that.
What FICA Stands For
FICA = Federal Insurance Contributions Act, a 1935 law that created mandatory payroll taxes to fund Social Security retirement benefits. Medicare was added in 1965.
The FICA Rate Breakdown
| Component | Employee Rate | What It Funds |
|---|---|---|
| Social Security (OASDI) | 6.2% | Retirement, disability, survivor benefits |
| Medicare (HI) | 1.45% | Hospital insurance for those 65+ |
| Total FICA | 7.65% |
Your employer also pays 7.65% directly to the IRS — you never see that money, but it doubles the contribution made on your behalf.
How Much FICA You Pay
| Gross Paycheck | Social Security (6.2%) | Medicare (1.45%) | Total FICA |
|---|---|---|---|
| $500 | $31.00 | $7.25 | $38.25 |
| $1,000 | $62.00 | $14.50 | $76.50 |
| $2,000 | $124.00 | $29.00 | $153.00 |
| $3,000 | $186.00 | $43.50 | $229.50 |
| $5,000 | $310.00 | $72.50 | $382.50 |
The Social Security Wage Cap
Social Security has an annual earnings cap. In 2024, you only pay Social Security on the first $168,600 you earn.
| Situation | Social Security Tax |
|---|---|
| Earnings below $168,600 | Full 6.2% applies |
| Earnings above $168,600 | 6.2% stops for the year |
| Any earnings | Medicare 1.45% always applies |
The cap resets every January 1. High earners notice their December paycheck is slightly larger because Social Security withholding stops.
Additional Medicare Tax
If you earn over $200,000, an extra 0.9% Medicare surtax applies:
| Threshold | Filing Status |
|---|---|
| $200,000 | Single or head of household |
| $250,000 | Married filing jointly |
| $125,000 | Married filing separately |
This extra 0.9% is only deducted from your wages — your employer does not match it.
What Your FICA Taxes Pay For
Social Security (6.2%)
| Benefit | Who Qualifies |
|---|---|
| Retirement benefits | Workers 62+ with enough credits |
| Disability benefits (SSDI) | Workers with disabilities |
| Survivor benefits | Families of deceased workers |
Medicare (1.45%)
| Part | Coverage |
|---|---|
| Medicare Part A | Hospital stays — premium-free if you paid FICA 10+ years |
| Medicare Part B | Doctor visits — requires a monthly premium |
FICA vs. Federal Income Tax
| Feature | FICA | Federal Income Tax |
|---|---|---|
| Rate | Flat (7.65%) | Progressive (10-37%) |
| Can you reduce it? | Almost never | Yes, via W-4 and pre-tax accounts |
| What it funds | Social Security + Medicare | General government |
| Based on income level? | No (until cap) | Yes |
Exemptions from FICA
Very few people are exempt:
| Who May Be Exempt | Reason |
|---|---|
| Some student workers | While enrolled and employed by their school |
| Certain nonresident aliens | On specific visa types |
| Some religious sect members | If the sect opposes Social Security |
| Some state/local government workers | If covered by a state pension instead |
If you see $0 in FICA on your pay stub and you’re not in one of these categories, contact payroll immediately — you may have an error.
Related: Understanding Paycheck Deductions | What Is OASDI on My Paycheck | Why Is So Much Taken Out of My Paycheck