How much comes out of your paycheck for Medicare and Social Security
Your employer and you each pay 6.2% of your wages into Social Security, for a total of 12.4%. You each pay 1.45% into Medicare Part A (hospital insurance), for a total of 2.9%. If you earn over a certain threshold — $200,000 as a single filer in 2024 — you pay an extra 0.9% Medicare tax on the amount above that line, and your employer does not match it.
These amounts are withheld from your paycheck automatically. If you are self-employed, you pay both the employee and employer share yourself: 12.4% for Social Security and 2.9% for Medicare, plus the 0.9% surtax if your income exceeds the threshold. The self-employed rate is higher because you cover both sides of the tax.
The Social Security and Medicare tax rates have been set by federal law and do not change year to year, though Congress can alter them. The income threshold for the extra Medicare tax does adjust annually for inflation.
Key Takeaways
- You and your employer each pay 6.2% of wages to Social Security and 1.45% to Medicare Part A, taken directly from your paycheck.
- If you earn over $200,000 (single filer), you pay an additional 0.9% Medicare tax on income above that amount, and your employer does not contribute to this surtax.
- Self-employed workers pay the full 12.4% Social Security tax and 2.9% Medicare tax themselves, since they are both employer and employee.
- These tax rates are set by federal law and remain the same each year, though the income threshold for the extra Medicare tax rises with inflation.
Why you pay these taxes and where the money goes
Social Security tax funds retirement, disability, and survivor benefits. When you turn 62 or older, you can begin drawing monthly payments based on your earnings history. If you become disabled before retirement age, you may receive benefits. If you die, your spouse or children may receive survivor benefits.
Medicare tax funds Part A, which covers hospital stays, skilled nursing care, hospice, and some home health services. Part A is automatic when you turn 65 if you are receiving Social Security. You do not pay a separate premium for Part A coverage — the tax you paid during your working years funds it.
The money does not sit in an account with your name on it. Instead, current workers' taxes pay current retirees' benefits. This is called a pay-as-you-go system. When you retire, future workers' taxes will fund your benefits.
How much you have paid over your working life
You can see a running total of your Social Security and Medicare taxes on your Social Security statement. To view it, create an account at ssa.gov and log in. The statement shows your estimated retirement benefit at different ages, your disability benefit estimate, and your family's survivor benefit estimate.
Your statement also lists your earnings history year by year and the taxes withheld. Social Security uses your highest 35 years of earnings to calculate your benefit amount, so the statement helps you understand which years count toward your benefit.
If you do not have an online account, you can request a paper statement by mail from the Social Security Administration, though it takes several weeks to arrive.
What happens if you work after you start receiving benefits
If you claim Social Security before your full retirement age and continue working, your benefit is reduced by $1 for every $2 you earn above an annual limit. In 2024, that limit is $23,400. The reduction applies only in the year you claim and the years before you reach full retirement age.
Once you reach your full retirement age, you can earn any amount without a reduction to your benefit. You will still pay Social Security and Medicare taxes on your wages, even after you start receiving benefits.
Medicare taxes continue to be withheld from your paycheck regardless of your age or whether you are receiving Social Security. The extra 0.9% Medicare tax still applies if your income exceeds the threshold.
Self-employed workers and quarterly tax payments
If you are self-employed, you pay Social Security and Medicare taxes through quarterly estimated tax payments to the IRS, not through paycheck withholding. You calculate your net self-employment income (your business income minus business expenses) and pay 92.35% of that amount in self-employment tax.
The self-employment tax rate is 15.3% total: 12.4% for Social Security and 2.9% for Medicare. You can deduct half of your self-employment tax as a business expense on your tax return, which reduces your taxable income.
If your self-employment income exceeds $200,000 (single filer), you also owe the 0.9% Medicare surtax on the amount above that threshold. You report this on your tax return when you file.
Income limits and how they affect your taxes
Social Security tax applies only to wages up to a certain limit, called the wage base. In 2024, that limit is $168,600. Any income above that amount is not subject to the 6.2% Social Security tax. This means high earners pay a smaller percentage of their total income into Social Security than lower-wage workers do.
Medicare tax, by contrast, has no upper limit on the 1.45% portion. All of your wages, no matter how high, are subject to the standard 1.45% Medicare tax. The 0.9% surtax kicks in only on income above $200,000 (single), $250,000 (married filing jointly), or $125,000 (married filing separately).
The Social Security wage base rises each year based on average wage growth in the economy. The Medicare income thresholds for the surtax also adjust annually for inflation.
Frequently Asked Questions
Do I pay Medicare tax on my entire paycheck?
Yes, the standard 1.45% Medicare tax applies to all of your wages with no upper limit. However, if you earn over $200,000 as a single filer, you pay an additional 0.9% on income above that threshold. Social Security tax, by contrast, stops once you reach the annual wage base limit.
Can I opt out of paying Social Security or Medicare taxes?
No. These taxes are mandatory for all employees and self-employed workers. The only exception is certain members of religious groups who have been granted a waiver by the IRS, but this is rare and requires a formal process.
What if I worked in another country — do those years count toward my Social Security benefit?
It depends on whether the United States has a totalization agreement with that country. Some countries' work credits can be combined with U.S. credits to reach the 40 credits needed for a benefit. Contact the Social Security Administration to ask about your specific situation.
If I die before I turn 65, do I get my Medicare taxes back?
No. Medicare taxes fund Part A coverage for current beneficiaries. However, your family may be may have access to to survivor benefits from Social Security based on your earnings record, which is a separate benefit from the taxes you paid.
Why do I pay Social Security tax if I will not need the money when I retire?
Social Security is not optional based on need. All workers pay the same rate regardless of income level or whether they expect to use the benefit. The program also provides disability and survivor benefits, which may help you or your family even if you never claim a retirement benefit.