How much comes out of your paycheck for Social Security and Medicare

Social Security tax takes 6.2% of your wages, and Medicare tax takes 1.45%. If you are employed, your employer matches both amounts — so you see 6.2% + 1.45% = 7.65% withheld from your paycheck, and your employer pays another 7.65% on your behalf. If you are self-employed, you pay both the employee and employer share, which comes to 15.3% total on your net earnings from self-employment.

These percentages have been set by federal law and do not change year to year. What changes is the wage base — the maximum amount of annual income subject to Social Security tax. For 2024, that cap is $168,600. Medicare tax has no wage cap, so it applies to all your earnings no matter how high they go.

If you earn over the Social Security wage base in a given year, you stop paying the 6.2% once you hit that limit. Medicare tax continues on every dollar you earn. This is why high earners see their paycheck percentage drop partway through the year.

Key Takeaways

  • Employees pay 6.2% for Social Security and 1.45% for Medicare; employers match both amounts.
  • Self-employed people pay 15.3% total (both employee and employer shares) on net self-employment income.
  • Social Security tax stops once you reach the annual wage base ($168,600 in 2024), but Medicare tax continues on all earnings.
  • High earners pay an additional 0.9% Medicare tax on income above $200,000 (single) or $250,000 (married filing jointly).

The Social Security wage base and why it matters

The Social Security wage base is the maximum income amount subject to the 6.2% tax in a calendar year. Once you earn that amount, your employer stops withholding the 6.2% for the rest of the year. The wage base increases most years to account for inflation — it was $160,200 in 2023 and $168,600 in 2024.

This cap exists because Social Security benefits are tied to your earnings history, and the program has a maximum benefit amount. The wage base ensures that very high earners do not pay Social Security tax on unlimited income. Medicare has no such cap, so a surgeon or executive pays the 1.45% on every dollar earned, no matter how much that is.

If you change jobs during the year, you may temporarily pay more Social Security tax than you owe. If you overpay, you can claim the excess as a credit on your federal income tax return.

Additional Medicare tax for high earners

If your income exceeds certain thresholds, you pay an extra 0.9% Medicare tax on the amount over the limit. The thresholds are $200,000 for single filers, $250,000 for married couples filing jointly, and $125,000 for married couples filing separately. This additional tax applies to wages, self-employment income, and certain investment income.

Unlike the regular 1.45% Medicare tax, the additional 0.9% is not matched by employers — you pay it entirely yourself. Your employer withholds it from your paycheck if your income crosses the threshold, or you may owe it when you file your tax return if your income from multiple jobs or self-employment pushes you over the limit.

What self-employed people pay

If you are self-employed, you pay both the employee and employer portions of Social Security and Medicare tax. This is called self-employment tax, and it totals 15.3% (12.4% for Social Security, 2.9% for Medicare) on your net self-employment income. You calculate this on Schedule SE and report it on your tax return.

You do get one break: you can deduct half of your self-employment tax as an adjustment to income on your tax return. This reduces your taxable income but does not reduce the amount you owe in self-employment tax itself. If you earn over the Social Security wage base, the 12.4% portion stops, but the 2.9% Medicare portion continues on all earnings.

How these taxes fund Social Security and Medicare

The money withheld from your paycheck goes directly into two federal trust funds: the Social Security Trust Fund and the Medicare Hospital Insurance Trust Fund. These funds pay current benefits to retirees, disabled workers, and their families. You are not building a personal account — the taxes you pay today fund benefits for people receiving them now.

When you reach retirement age or become disabled, your own benefits are paid from the taxes current workers contribute. The amount you receive is based on your earnings history and the age at which you claim, not on how much tax you paid in.

Checking your Social Security record

You can view your earnings record and estimated benefits on the Social Security Administration website at ssa.gov. Create a my Social Security account to see how much you have paid in Social Security and Medicare tax over your lifetime, and to see your projected benefit amount at different claiming ages.

Review your earnings record for accuracy — if your employer reported your income incorrectly, it can affect your future benefits. If you spot an error, contact Social Security directly to request a correction. Errors are usually caught within a few years, but it is worth checking periodically.

Frequently Asked Questions

What happens to my Social Security and Medicare taxes if I work past age 65?

You continue paying both taxes on your wages no matter your age. There is no exemption from payroll taxes once you reach retirement age. However, you can claim Social Security benefits while still working — your benefit amount may be reduced if you earn above a certain limit, but the taxes you pay continue to count toward your record.

Can I opt out of paying Social Security or Medicare tax?

No. These taxes are mandatory for all employees and self-employed people. The only exception is certain religious groups that have obtained a formal exemption from the IRS, which is rare and requires specific conditions to be met.

Do I pay Social Security and Medicare tax on all my income?

Social Security tax applies only to wages and self-employment income up to the annual wage base. Medicare tax applies to all wages and self-employment income with no limit. Investment income, rental income, and most other sources do not trigger these payroll taxes, though they may be subject to other taxes.

If I worked in multiple jobs, can I get a refund for overpaying Social Security tax?

Yes. If your combined earnings from all jobs exceed the wage base in a single year, you may have paid more Social Security tax than required. You can claim the overpayment as a credit on your federal income tax return, or if you are owed a refund, it will be included in your refund check.

How do I know if I owe the additional 0.9% Medicare tax?

Your employer withholds it automatically if your wages exceed the threshold. If you have income from multiple jobs or self-employment, you may owe additional tax when you file your return. Use Form 8959 to calculate whether you owe the additional tax and claim any excess withholding.