FICA (Federal Insurance Contributions Act)

The US payroll tax that funds Social Security (6.2%) and Medicare (1.45%), paid in equal parts by the employee and employer on most wages.

FICA stands for the Federal Insurance Contributions Act — the law that authorises payroll deductions for Social Security and Medicare. Employees see two separate FICA lines on a pay stub: 6.2% for Social Security up to the annual wage base ($168,600 for 2026, indexed each year) and 1.45% for Medicare on all wages. Employers pay matching amounts, so the total FICA wedge on each dollar of wages is 15.3% — half employee, half employer.

Two add-ons:

Additional Medicare Tax: an extra 0.9% on wages above $200,000 (single) or $250,000 (married filing jointly). Withheld by the employer once an individual employee crosses $200,000, regardless of filing status — overpayments are reconciled on the 1040.
Net Investment Income Tax: a 3.8% surcharge on investment income for higher earners, technically separate from FICA but functionally connected to the same Medicare funding policy.

The Social Security wage base means high earners stop paying the 6.2% portion after they hit the cap, but the 1.45% Medicare and the 0.9% Additional Medicare keep going on every dollar.

Self-employed workers pay both halves as Self-Employment Tax (15.3% total), and can deduct one half on the 1040. Use the FICA calculator for the employee view or the self-employment tax calculator for the SE side.