2025 Social Security, FICA and Medicare Update
New for 2025: The Social Security wage cap will be increased from the 2024 limit of $168,600 to the new 2025 limit of $176,100. The Federal Insurance Contributions Act (FICA) tax on wages remains at 7.65% for both the employee and the employer. FICA tax has two components – Social Security taxes (also known as old age, survivors and disability insurance or OASDI) remain at 6.20% while Medicare tax (also known as hospital insurance or HI) has an additional 0.90%, increasing o 1.45%. This 0.90% tax applies to wages exceeding $250,000 for married taxpayers who file a joint return, $125,000 for married taxpayers who file separate returns and $200,000 for other taxpayers. It should be noted, the Medicare withholding amounts still remain without any income limits or caps.
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