1. What is Social Security Tax?

Social Security tax is a payroll tax collected to fund the Social Security program. In 2025, the tax rate is 6.2% for employees (matched by employers) on earnings up to the wage base limit of $168,600.

2. How Does the Calculator Work?

The calculator uses the Social Security tax formula:

Where:

• \( Taxable\ Income \) — Earnings subject to Social Security tax
• \( Wage\ Base \) — Maximum earnings subject to tax ($168,600 in 2025)
• \( 6.2\% \) — Social Security tax rate

Explanation: The tax is calculated on the lesser of your taxable income or the wage base limit.

3. Importance of Social Security Tax

Details: Social Security taxes fund retirement, disability, and survivor benefits. Understanding your tax helps with financial planning and ensures proper withholding.

4. Using the Calculator

Tips: Enter your taxable income and the current wage base (defaults to 2025 amount). The calculator will determine how much Social Security tax you owe.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between Social Security and Medicare tax?
A: Social Security tax (6.2%) has a wage base limit, while Medicare tax (1.45%) applies to all earnings with an additional 0.9% on high incomes.

Q2: Does my employer match my Social Security tax?
A: Yes, employers pay an equal 6.2% tax, making the total Social Security contribution 12.4%.

Q3: What if I have multiple jobs?
A: Each employer withholds Social Security tax separately. You may get a refund if total withholdings exceed the annual maximum.

Q4: Are self-employed people subject to this tax?
A: Yes, self-employed individuals pay both employee and employer portions (12.4% total) through self-employment tax.

Q5: How often does the wage base change?
A: The wage base typically increases annually based on national wage trends. The 2025 amount is projected to be $168,600.