FICA is the payroll tax shown in Boxes 3 through 6 of your W-2, and it funds Social Security and Medicare. Your employer withholds 7.65% of your wages each pay period: 6.2% for Social Security and 1.45% for Medicare. Your employer pays a matching 7.65% that never shows up on your pay stub. For 2026, the 6.2% Social Security portion applies only to the first $184,500 you earn; the 1.45% Medicare portion applies to every dollar with no cap.
What FICA Actually Is
FICA stands for the Federal Insurance Contributions Act. It bundles two separate taxes into one payroll deduction. The Social Security piece funds monthly benefits for retired workers, families of deceased workers, and people with qualifying disabilities.1Social Security Administration. Social Security (Old-Age, Survivors, and Disability Insurance) Program Description and Legislative History The Medicare piece funds health coverage primarily for people 65 and older and certain younger people with disabilities.2Medicare. Get Started With Medicare
The law imposes the employee portion on your wages and an equal employer portion on your employer for the privilege of having you on payroll.3Office of the Law Revision Counsel. 26 U.S. Code 3101 – Rate of Tax Your W-2 only reports your half. The employer match is real money flowing into the same programs, but it doesn’t appear on your forms.
For 2026, the combined 6.2% Social Security rate stops once your wages hit $184,500. The maximum Social Security tax an employee can pay for the year is $11,439.4Social Security Administration. Contribution and Benefit Base The 1.45% Medicare rate keeps going.5Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates
How to Read Boxes 3 Through 6 on Your W-2
Four boxes on your W-2 tell the FICA story.
- Box 3 — Social Security Wages. The wages subject to the 6.2% Social Security tax. Box 3 caps at the annual wage base ($184,500 for 2026). If you earned more, Box 3 shows the cap rather than your full pay.6Internal Revenue Service. About Form W-2, Wage and Tax Statement
- Box 4 — Social Security Tax Withheld. The dollars taken from your paychecks for Social Security. This should equal Box 3 times 6.2%. Someone who hit the 2026 cap should see $11,439 in Box 4.
- Box 5 — Medicare Wages and Tips. The wages subject to Medicare tax. Because there is no wage cap, this is often the largest wage figure on your W-2.
- Box 6 — Medicare Tax Withheld. The total Medicare withholding, including any Additional Medicare Tax on wages above $200,000. If you earned under $200,000, Box 6 should equal Box 5 times 1.45%.
A quick sanity check: divide Box 4 by Box 3. You should land at 0.062 or very close after rounding. Then divide Box 6 by Box 5. If your wages stayed below $200,000, you should get 0.0145. If those ratios are off, something may need correcting.
Why Your FICA Wages Don’t Match Box 1
Box 1 shows wages subject to federal income tax. Boxes 3 and 5 show wages subject to FICA. These numbers often disagree, and the reason confuses a lot of people: some pre-tax deductions reduce your income tax wages but not your FICA wages.
Traditional 401(k) contributions are the most common example. If you defer $10,000 into your 401(k), that amount comes out of Box 1 but stays in Boxes 3 and 5. You save income tax, but you still pay full FICA on every dollar contributed.7Internal Revenue Service. Are Retirement Plan Contributions Subject to Withholding for FICA, Medicare, or Federal Income Tax The same treatment applies to 403(b), most 457(b), and Roth salary deferrals.
Other benefits reduce both income tax and FICA wages. Benefits paid through a Section 125 cafeteria plan, such as health insurance premiums, flexible spending accounts, and dependent care assistance, are generally exempt from FICA entirely.8Internal Revenue Service. FAQs for Government Entities Regarding Cafeteria Plans Health Savings Account contributions made through payroll get the same double break.9Internal Revenue Service. Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans Two exceptions inside a cafeteria plan still get hit with FICA: group-term life insurance coverage above $50,000 and adoption assistance benefits.
So if you contribute to a 401(k), expect Boxes 3 and 5 to be higher than Box 1. If you pay health premiums or fund an HSA through payroll, expect Boxes 3 and 5 to be lower than your gross pay.
The Additional Medicare Tax for Higher Earners
An extra 0.9% Additional Medicare Tax kicks in above a threshold set by your filing status:10Internal Revenue Service. Topic No. 560, Additional Medicare Tax
- Single, head of household, or qualifying surviving spouse: $200,000
- Married filing jointly: $250,000
- Married filing separately: $125,000
These thresholds are not adjusted for inflation.11Internal Revenue Service. Instructions for Form 8959 Your employer doesn’t know your filing status, so the law requires withholding to start once your wages from that one employer cross $200,000, regardless of how you file. Your employer does not match this extra 0.9%; it’s entirely yours.
That mismatch can go either way at tax time. If you’re married filing jointly and neither spouse individually crosses $200,000 with any single employer, nothing extra is withheld, but you still owe the tax on combined wages above $250,000. If you’re married filing separately, withholding doesn’t start until $200,000 even though your threshold is $125,000, so you’ll owe more. Either way, Form 8959 reconciles the difference on your return.11Internal Revenue Service. Instructions for Form 8959
Excess Social Security Withholding With Two or More Jobs
The Social Security wage base applies to your total earnings for the year, but each employer tracks withholding independently. If you worked two jobs and each paid you $120,000, both would withhold 6.2% on the full $120,000. Your combined Social Security withholding would be $14,880 on $240,000 of wages, well above the 2026 maximum of $11,439.4Social Security Administration. Contribution and Benefit Base
The fix is on your federal return. Claim the excess as a credit; the Form 1040 instructions walk you through the calculation, and the overpayment becomes part of your refund or reduces your bill.12Internal Revenue Service. Topic No. 608, Excess Social Security and RRTA Tax Withheld This route only works for multiple employers. If one employer over-withheld, that employer has to correct it directly.
What to Do If Your W-2 Is Wrong
If the math doesn’t add up, or your employer withheld too much or too little FICA, contact your employer or payroll department first. Mistakes happen: a miscoded benefit, a late address change, a payroll system glitch. Your employer can issue Form W-2c to fix the error.13Internal Revenue Service. If You Don’t Get a W-2 or Your W-2 Is Wrong
If your employer won’t cooperate or you can’t reach them, call the IRS. The IRS will send your employer a letter requesting a corrected W-2 within 10 days and will give you instructions for filing with Form 4852 as a substitute so you don’t miss the deadline.
Who Doesn’t Pay FICA
Nearly everyone with a paycheck pays FICA, including workers already collecting Social Security and workers over 70. A few narrow exceptions exist:
- Students enrolled at least half-time who work for the same school, provided the job is incidental to their studies and they aren’t treated as professional employees with vacation, sick leave, or retirement plan eligibility.14Internal Revenue Service. Student FICA Exception
- Nonresident alien students and scholars on F-1, J-1, or M-1 visas, generally for their first five calendar years in the U.S.15Internal Revenue Service. Foreign Student Liability for Social Security and Medicare Taxes
- Members of recognized religious groups that have existed continuously since 1950 and conscientiously oppose all insurance, who apply and are approved on Form 4029; approval permanently waives Social Security and Medicare benefits.16Internal Revenue Service. Form 4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits
One boundary worth naming: if you’re self-employed, you don’t pay FICA and none of this appears on a W-2. You pay self-employment tax instead, at 15.3% combined, reported on Schedule SE with your Form 1040.