1. What is Social Security Tax?

Social Security tax is a payroll tax that funds the Social Security program in the United States. It's collected under the Federal Insurance Contributions Act (FICA) or the Self-Employed Contributions Act (SECA) for self-employed individuals.

2. How is Social Security Tax Calculated?

The calculator uses the following formula:

Where:

• Taxable Income — Employee's gross earnings subject to Social Security tax
• Wage Base — Maximum earnings subject to Social Security tax ($168,600 in 2025)
• 6.2% — Social Security tax rate for employees

Explanation: The tax is calculated at 6.2% of earnings up to the wage base limit. Earnings above the wage base are not taxed for Social Security.

3. 2025 Updates

Details: For 2025, the Social Security wage base is projected to be $168,600 (subject to official confirmation by the SSA). The tax rate remains 6.2% for employees (12.4% for self-employed).

4. Using the Calculator

Tips: Enter your taxable income and the wage base (default is set to 2025 projected amount). The calculator will determine how much of your income is subject to Social Security tax and compute the amount owed.

5. Frequently Asked Questions (FAQ)

Q1: Who pays Social Security tax?
A: All employees and employers (through payroll taxes) and self-employed individuals (through SECA taxes).

Q2: Is there a maximum Social Security tax I can pay?
A: Yes, in 2025 the maximum employee contribution would be $168,600 × 6.2% = $10,453.20.

Q3: What's the difference between Social Security and Medicare tax?
A: They're both payroll taxes but have different rates (6.2% vs 1.45%) and Medicare has no wage base limit.

Q4: Do I pay Social Security tax on investment income?
A: No, only on earned income (wages, salaries, self-employment income).

Q5: How often is the wage base adjusted?
A: Annually, based on changes in the national average wage index.