How to Calculate FICA Tax: Wages, Steps, and Exemptions

To calculate FICA tax, multiply your FICA-taxable wages by 6.2% for Social Security and 1.45% for Medicare, for a combined employee rate of 7.65%. In 2026, the Social Security portion applies only to the first $184,500 you earn; the Medicare portion has no cap. If you are self-employed, you owe both halves at a combined 15.3%, applied to 92.35% of your net earnings.¹

What Counts as FICA Wages

Start with gross pay: salary or hourly wages, bonuses, commissions, and most other compensation. Not everything in that gross number is taxed for FICA, though. Health insurance premiums and other benefits routed through a Section 125 cafeteria plan are generally excluded from FICA wages.²

Retirement contributions are the surprise. Pre-tax deferrals to a 401(k) or 403(b) reduce your federal income tax, but they remain fully subject to Social Security and Medicare taxes.³ Earn $80,000 and defer $5,000 into a 401(k), and your income tax applies to $75,000, but your FICA taxes still apply to the full $80,000 (minus any cafeteria plan deductions).

The Employee Calculation, Step by Step

Find your FICA wages. Take gross pay for the period and subtract any Section 125 cafeteria plan deductions (health insurance premiums, FSA contributions, and the like).
Calculate Social Security tax. Multiply your FICA wages by 0.062. This applies only until your year-to-date earnings reach $184,500 in 2026. After that, the 6.2% stops for the rest of the year.⁴
Calculate Medicare tax. Multiply the same FICA wages by 0.0145. There is no wage cap.⁵
Add them together. The sum is your FICA withholding for the pay period.

A Worked Example

You earn $5,000 in gross biweekly pay and have $200 in cafeteria plan health premiums. Your FICA wages are $4,800.

Social Security: $4,800 × 0.062 = $297.60
Medicare: $4,800 × 0.0145 = $69.60
Total FICA withholding: $367.20

Crossing the Wage Base Mid-Paycheck

If a paycheck pushes your year-to-date earnings past $184,500, only the wages up to the cap get the 6.2%. Say you have already earned $182,000 and your next check has $5,000 in FICA wages. Only $2,500 of that check is subject to Social Security tax, because $182,000 + $2,500 equals the $184,500 ceiling. The other $2,500 is free of Social Security tax. Medicare tax still applies to the full $5,000.

Additional Medicare Tax for Higher Earners

On top of the 1.45% Medicare tax, a 0.9% Additional Medicare Tax applies once your wages exceed the threshold for your filing status:⁶

Single filers: $200,000
Married filing jointly: $250,000
Married filing separately: $125,000

Your employer starts withholding the extra 0.9% once your wages pass $200,000 in a calendar year, regardless of your filing status. The filing-status thresholds are reconciled on your tax return. If you are married filing jointly, your combined wages are under $250,000, but your individual wages exceeded $200,000 and triggered withholding, you can claim the excess back at filing.⁷

Only wages above the threshold get the extra 0.9%. A single filer earning $240,000 pays 1.45% on all $240,000 plus 0.9% on the $40,000 that exceeds $200,000, adding $360 to the total. There is no employer match on the Additional Medicare Tax; it falls entirely on the employee.⁵

How Self-Employed People Calculate FICA

When you work for yourself, you pay both halves. The tax code calls this self-employment tax under 26 U.S.C. § 1401, and the combined rate is 15.3%: 12.4% for Social Security and 2.9% for Medicare.⁸ You do not simply multiply net profit by 15.3%. There is a step that reduces the taxable base first.

Calculate net earnings from self-employment (revenue minus business expenses).
Multiply net earnings by 0.9235. This adjustment mirrors the fact that employees do not pay FICA on the employer’s share.
Multiply the result by 0.124 for Social Security, on amounts up to the $184,500 wage base for 2026.⁴
Multiply the same 92.35% figure by 0.029 for Medicare, with no cap. If your earnings exceed the Additional Medicare Tax thresholds, apply 0.9% to the excess.
Deduct half of the self-employment tax as an adjustment to income when you file. This lowers your adjusted gross income; it does not lower the self-employment tax itself.⁹

A Self-Employment Example

Your Schedule C shows $100,000 in net profit. Multiply by 0.9235 to get $92,350.

Social Security: $92,350 × 0.124 = $11,451.40
Medicare: $92,350 × 0.029 = $2,678.15
Total self-employment tax: $14,129.55

You then deduct roughly $7,065 (half) as an income adjustment. That deduction reduces your income tax, but you still owe the full $14,129.55 in self-employment tax.

Overpaying Social Security With Two Jobs

If you work for two or more employers in the same year and your combined wages exceed $184,500, you will likely have too much Social Security tax withheld. Each employer withholds independently based on what it pays you, and neither knows what the other has taken out. The IRS lets you claim the excess as a credit on your income tax return.¹⁰

Add up the Social Security tax on all your W-2s. For 2026, the maximum any one person should pay is $11,439 ($184,500 × 0.062). Anything above that goes on Schedule 3 of Form 1040 as a credit. If a single employer withheld too much on its own, you have to ask that employer for a correction. If the employer will not fix it, file Form 843 to request a refund from the IRS.¹⁰

Who Is Exempt From FICA

Most workers owe FICA on every paycheck, but the tax does not apply to everyone:

Students employed by their own school. If you are enrolled at least half-time at a college or university and work for that same institution, your wages may be exempt under IRC Section 3121(b)(10). The work has to be connected to your course of study, and you cannot be receiving career-employee benefits like vacation pay, retirement contributions, or sick leave. Graduate students who receive professional-level benefits generally do not qualify, even at a full course load.¹¹
Certain nonresident aliens. International students and scholars on F-1, J-1, M-1, or Q-1/Q-2 visas are generally exempt during their first several years in the U.S. (five calendar years for students, two for non-student J-1 holders), as long as they have not met the substantial presence test. Workers on H-1B, TN, O-1, and E-3 visas are fully subject to FICA from day one.
Members of certain religious groups. Members of recognized religious sects who are conscientiously opposed to Social Security benefits can apply for an exemption by filing Form 4029 with the IRS.

2026 FICA Rates and Wage Base at a Glance

Social Security tax rate: 6.2% employee + 6.2% employer¹²
Social Security wage base: $184,500⁴
Maximum employee Social Security tax: $11,439
Medicare tax rate: 1.45% employee + 1.45% employer, no wage cap¹²
Additional Medicare Tax: 0.9% on wages above $200,000 (single), $250,000 (married filing jointly), or $125,000 (married filing separately), employee only⁶
Self-employment tax rate: 15.3% (12.4% Social Security + 2.9% Medicare) on 92.35% of net earnings

1
Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates
2
Internal Revenue Service. FAQs for Government Entities Regarding Cafeteria Plans
3
Internal Revenue Service. Are Retirement Plan Contributions Subject to Withholding for FICA, Medicare, or Federal Income Tax
4
Social Security Administration. Contribution and Benefit Base
5
Internal Revenue Service. Publication 15 (2026), (Circular E), Employers Tax Guide
6
Internal Revenue Service. Topic No. 560, Additional Medicare Tax
7
Internal Revenue Service. Questions and Answers for the Additional Medicare Tax
8
Office of the Law Revision Counsel. 26 USC Chapter 2 – Tax on Self-Employment Income
9
Internal Revenue Service. Topic No. 554, Self-Employment Tax
10
Internal Revenue Service. Topic No. 608, Excess Social Security and RRTA Tax Withheld
11
Internal Revenue Service. Student FICA Exception
12
Office of the Law Revision Counsel. 26 USC 3101 – Rate of Tax