Official 2027 figures confirmed. Checked November 12, 2026. Read the primary source. Tax-year amounts apply to 2027, not 2026 returns filed during 2027.
Choose the payer, then the income base
Employee payroll
6.2% Social Security up to $192,300 covered wages; 1.45% regular Medicare without that cap. Employee Social Security maximum: $11,922.60.
Employer payroll
The employer separately pays 6.2% capped Social Security and 1.45% uncapped Medicare. It does not match the employee’s 0.9% Additional Medicare tax.
Self-employment
Regular SE tax uses generally 92.35% of net profit, with the remaining Social Security cap after covered W-2 wages. Medicare does not inherit the Social Security cap.
6.2% Social Security + 1.45% MedicareWages above $192,300
Regular Medicare continues; Social Security stops
Employer withholding starts Additional Medicare once that employer pays over $200,000, regardless of filing status. Final liability uses $200,000 single/HOH/QSS, $250,000 joint or $125,000 married-separate; reconcile on Form 8959. Wages and SE income interact for this test.
2027 FICA Tax Rates — Unchanged by Statute
| Tax Component | Employee Withholding | Employer Match | Self-Employed (SECA) |
|---|---|---|---|
| Social Security (OASDI) | 6.2% | 6.2% | 12.4% |
| Medicare (Hospital Insurance) | 1.45% | 1.45% | 2.9% |
| Total Baseline FICA | 7.65% | 7.65% | 15.3% |
Social Security Wage Base (Confirmed)
| Detail | 2027 Confirmed | 2026 Confirmed | Statutory Notes |
|---|---|---|---|
| Taxable Wage Base Limit | $192,300 | $184,500 | Tied to National Average Wage Index (AWI) |
| Max Employee Social Security Tax | $11,922.60 | $11,439.00 | 6.2% applied up to wage base cap |
| Max Employer Social Security Tax | $11,922.60 | $11,439.00 | Dollar-for-dollar employer matching |
| Max Combined (W-2 Employee + Employer) | $23,845.20 | $22,878.00 | 12.4% total OASDI contribution |
Additional Medicare Tax Thresholds — Fixed by Statute
The Additional Medicare Tax of 0.9% under IRC § 3101(b)(2) applies exclusively to employee and self-employment earnings exceeding statutory limits. Employers do not match this surtax:
| Filing Status | Statutory Threshold | Additional Rate | Employer Matching |
|---|---|---|---|
| Single / Head of Household / Qualifying Surviving Spouse | $200,000 | 0.9% | None (Employee only) |
| Married Filing Jointly | $250,000 | 0.9% | None (Employee only) |
| Married Filing Separately | $125,000 | 0.9% | None (Employee only) |
Withholding is not the final tax: each employer begins Additional Medicare Tax withholding when it pays you more than $200,000, regardless of filing status or your spouse’s wages. Your return reconciles total Medicare wages and self-employment earnings against your filing-status threshold on Form 8959. See IRS Additional Medicare Tax guidance.
Household payroll: SSA confirmed a $3,100 cash-wage coverage threshold for 2027. Paying that amount or more to one household employee generally makes all their covered cash wages subject to Social Security and Medicare taxes, not only the excess. Family-member and age exceptions apply. The 2026 threshold was $3,000.
Explore the self-employment calculator’s 2025 tax assumptions. It does not yet apply this page’s 2027 confirmed wage base.
Open Self-Employment Tax Calculator →What Changed From 2026: Side-by-Side Summary
The table below summarizes statutory 2027 FICA payroll rates and confirmed wage thresholds compared with confirmed 2026 parameters under SSA OASDI Determinations.
| Provision / Tax Parameter | 2026 Confirmed | 2027 Confirmed | Change |
|---|---|---|---|
| Social Security Tax Rate (Employee / Employer) | 6.2% | 6.2% | — Fixed by statute |
| Medicare Tax Rate (Employee / Employer) | 1.45% | 1.45% | — Fixed by statute |
| Combined FICA Rate (Employee) | 7.65% | 7.65% | — Fixed by statute |
| Social Security Taxable Wage Base Limit | $184,500 | $192,300 | ↑ +$7,800 (+4.2%) |
| Maximum Social Security Tax (Employee W-2) | $11,439.00 | $11,922.60 | ↑ +$483.60 (+4.2%) |
| Maximum Social Security Tax (Self-Employed) | $22,878.00 | $23,845.20 | ↑ +$967.20 (+4.2%) |
| Additional Medicare Surtax (Single over $200k) | 0.9% | 0.9% | — Fixed threshold |
2026 vs 2027 Social Security Wage Base & Max Taxes
| Metric | 2026 | 2027 Confirmed |
|---|---|---|
| Wage Base Ceiling | $184,500 | $192,300 |
| Max Employee OASDI | $11,439 | $11,922.60 |
| Max Self-Employed OASDI | $22,878 | $23,845.20 |
Worked Example: W-2 vs. 1099 Self-Employed on $220,000 Income
Suppose Taylor is a single filer with either $220,000 of W-2 wages or $220,000 of self-employment net profit after business expenses in 2027, with no other wages or self-employment income. Using the final SSA $192,300 wage base gives the following illustration; it excludes income tax and is not a comparison of equal employer costs:
Scenario A: W-2 Employee
- Social Security Tax (6.2%): Capped at $192,300 wage base →
$192,300 × 6.2% = $11,922.60. - Medicare Tax (1.45%): Applies to all $220,000 →
$220,000 × 1.45% = $3,190.00. - Additional Medicare Surtax (0.9%): Applies to wages over $200,000 ($20,000) →
$20,000 × 0.9% = $180.00. - Total W-2 Employee Payroll Tax:
$11,922.60 + $3,190 + $180 = $15,292.60.
Scenario B: 1099 Independent Contractor (Self-Employed)
- SE Tax Base (92.35%):
$220,000 × 92.35% = $203,170.00. - Social Security Portion (12.4%): Capped at $192,300 →
$192,300 × 12.4% = $23,845.20. - Medicare Portion (2.9%): Applies to full SE base ($203,170) →
$203,170 × 2.9% = $5,891.93. - Additional Medicare Surtax (0.9%): Applies to SE base over $200,000 ($3,170) →
$3,170 × 0.9% = $28.53. - Total SECA Tax:
$23,845.20 + $5,891.93 + $28.53 = $29,765.66. - Above-the-Line Deduction: Taylor deducts 50% of the baseline SE tax (
$29,737.13 ÷ 2 = $14,868.57) on Schedule 1 to lower federal taxable income.
Wages plus a side business: for a single filer with $180,000 of Social Security wages and $30,000 of net business profit, the SE tax base is $30,000 × 92.35% = $27,705. Under the final $192,300 wage base, only $12,300 of room remains for Social Security tax: $12,300 × 12.4% = $1,525.20. Regular Medicare on the side business is $27,705 × 2.9% = $803.45. Combined Medicare wages and SE earnings are $207,705, producing $7,705 × 0.9% = $69.35 of Additional Medicare Tax. This example assumes no other earnings or adjustments and rounds to cents.
Who This Affects — and Who It Doesn't
- High Earners ($184.5k–$192.3k+): Pay 6.2% Social Security tax on an additional $7,800 of wages in 2027 ($483.60 extra tax).
- Self-Employed Professionals & Freelancers: Generally apply SECA to 92.35% of net profit, with the Social Security cap and Additional Medicare Tax rules applied separately.
- Employers & Payroll Managers: Use the final $192,300 wage base and verify the payroll system’s 2027 configuration.
- Multiple W-2 Job Holders: May experience excess Social Security tax withholding eligible for a Form 1040 tax credit.
- Workers Earning Under $184,500: Generally retain the same 7.65% combined employee rate on covered wages; exemptions and special wage treatment can apply.
- Passive Investment Income: Interest, dividends, and capital gains are exempt from FICA (potentially subject to NIIT instead).
- S-Corporation Shareholder Distributions: Non-wage profit distributions bypass FICA/SECA taxes.
- Some State & Local Public-Retirement Positions: Employees outside a Section 218 agreement with qualifying public retirement coverage may be exempt from Social Security tax. State and local employees hired after March 31, 1986 generally still pay Medicare tax under IRS coverage rules.
Tax Planning & Payroll Strategies for 2027
1. S-Corporation Reasonable Compensation Optimization: Business owners operating through an S-Corp can pay themselves a W-2 "reasonable salary" (subject to Social Security and Medicare payroll taxes) while taking remaining net profits as distributions, provided payments for services have first been treated as reasonable wages; distributions cannot be used to disguise compensation.
2. Claiming Multiple Employer Overwithholding: If you switch jobs mid-year or work for two employers whose combined wages exceed $192,300, both employers will withhold Social Security up to the cap. Generally claim excess employee Social Security withholding from multiple employers on Schedule 3 with Form 1040, using the applicable year’s instructions. If a single employer overwithheld, request its correction first.
3. Utilize Section 125 Pre-Tax Deductions: Pre-tax payroll deductions for health insurance, HSAs, and FSAs lower both federal income tax and FICA taxable wages, subject to each benefit’s eligibility rules. Payroll-tax savings vary with wages relative to the Social Security cap and Additional Medicare Tax thresholds; ordinary 401(k) deferrals do not reduce FICA wages.
A distribution labeled “S corporation” is not an automatic payroll-tax exemption: reasonable compensation for services still matters, and other taxes can apply. The regular half-SE-tax deduction does not include Additional Medicare tax.
Sources: SSA 2027 fact sheet confirms the $192,300 wage base. SSA coverage determinations confirms the $3,100 household-worker threshold. FICA rates follow IRC sections 3101 and 3111; self-employment tax follows section 1401. The wage base is wage-indexed and is not calculated by applying the 3.6% benefit COLA. Maximum employee Social Security tax is $192,300 × 6.2% = $11,922.60.
Frequently Asked Questions
What are the 2027 FICA tax rates?
FICA tax rates are set by federal statute and remain unchanged: 6.2% for Social Security and 1.45% for Medicare, totaling 7.65% for employees and matched equally by employers (15.3% combined).
What is the final 2027 Social Security wage base?
The final 2027 Social Security wage base is $192,300, compared with $184,500 in 2026. Its formula uses the national average wage index, not the benefit COLA percentage.
What is the maximum Social Security tax an employee will pay in 2027?
At a 6.2% rate on the confirmed $192,300 wage base, the maximum Social Security tax withheld from a single W-2 employee is $11,922.60 (up from $11,439.00 in 2026).
What are the Additional Medicare Tax thresholds for 2027?
The 0.9% Additional Medicare Tax applies to wages and self-employment earnings exceeding statutory thresholds of $200,000 for Single and Head of Household filers, $250,000 for Married Filing Jointly, and $125,000 for Married Filing Separately. These thresholds are fixed by law and not indexed for inflation.
How is Self-Employment Contributions Act (SECA) tax calculated in 2027?
Generally, 92.35% of net business profit is subject to regular SE tax: 12.4% Social Security up to the remaining wage base and 2.9% Medicare without a cap. The 2027 wage base is $192,300. W-2 Social Security wages use that same cap first; Additional Medicare Tax is calculated separately.
Is the employer matching portion of FICA deductible for businesses?
Yes. Employers can deduct their 7.65% matching share of FICA payroll taxes as an ordinary and necessary business expense under IRC § 162.
Can self-employed taxpayers deduct half of their SECA tax?
Generally, half of the regular self-employment tax is deductible as an adjustment on Schedule 1. The 0.9% Additional Medicare Tax is excluded from that deduction, as illustrated above.
What happens if an employee works two jobs and overpays Social Security tax?
If combined wages from multiple employers exceed the $192,300 wage base, each employer will withhold 6.2% up to the cap. The excess Social Security tax withheld is claimed as a refundable credit on Form 1040 when filing the annual return.
Does the Medicare tax have an upper income limit?
No. The standard 1.45% employee Medicare tax applies to all wages without any cap, and high earners pay an additional 0.9% surtax on earnings above $200k ($250k MFJ).
When does an employer begin withholding the 0.9% Additional Medicare Tax?
Employers are required to begin withholding the 0.9% surtax in the pay period when an employee's cumulative year-to-date wages with that employer exceed $200,000, regardless of the employee's marital filing status.
How does pre-tax health insurance impact FICA tax?
Contributions to Section 125 Cafeteria plans (such as employer health insurance, FSAs, and HSAs through payroll) are exempt from both FICA taxes and federal income tax, directly reducing taxable payroll wages.
Do traditional 401(k) contributions reduce FICA tax?
No. Traditional 401(k) and 403(b) contributions reduce federal and state income taxes, but they remain fully subject to FICA (Social Security and Medicare) payroll taxes.
How do S-Corporation owner-employees manage FICA tax?
S-Corp shareholder-employees pay FICA taxes (15.3% combined) only on their W-2 'reasonable compensation,' while remaining business profits distributed as shareholder distributions are exempt from FICA and SECA taxes.
Has the official 2027 Social Security wage base been published?
Yes. The SSA 2027 fact sheet confirms a $192,300 Social Security contribution and benefit base. At the 6.2% employee rate, the maximum employee Social Security withholding is $11,922.60; Medicare taxes are separate and uncapped.
Are tips subject to FICA tax?
Generally, cash tips totaling $20 or more from one job in a calendar month must be reported to the employer and are subject to FICA. An eligible federal income-tax deduction for tips or overtime does not make the underlying wages exempt from payroll tax.
Do household employers have to pay FICA tax for domestic workers in 2027?
The final 2027 household-employee cash-wage coverage threshold is $3,100 paid to one employee in the year. Reaching it generally makes all covered cash wages subject to Social Security and Medicare taxes. Family-member and age exceptions apply; see SSA and IRS household employment guidance.
Explore paycheck scenarios using the calculator’s supported tax year; its results do not automatically incorporate these 2027 figures.
Launch Take-Home Pay Calculator →Explore All 2027 Reference Hubs
How this page is reviewed
See methodology, assumptions & sources
| Risk tier | High YMYL |
|---|---|
| Author | Calculover Editorial Team Finance and legal education |
| Editorial owner | Calculover Tax & Payroll Desk Tax and wage methodology owner |
| Reviewer | Calculover Editorial Review High-risk source and limitation review |
| Status | Confirmed |
| Source as of | 2026-11-12 |
| Last reviewed | 2026-11-12 |
| Last verified | 2026-11-12 |
| Next review date | 2027-01-04 |
| Expected release | Final 2027 annual figures published. |
| Projection method | Final 2027 core figures come from the cited IRS or SSA release. Prior-year comparisons remain labeled; no uniform inflation multiplier is used. Any retirement or Medicare scenario is identified separately. |
| Data effective date | 2027-01-01 |
Methodology
Final 2027 core figures come from the cited IRS or SSA release. Prior-year comparisons remain labeled; no uniform inflation multiplier is used. Any retirement or Medicare scenario is identified separately.
Assumptions
- This is a reference article with fixed worked examples. Assumptions are stated beside each example; the page does not collect or verify personal financial inputs.
- Agency estimates and editorial scenarios are labeled separately from confirmed rules and must not be treated as final 2027 filing amounts.
- Linked calculators may support a different tax year; their displayed year and assumptions control their results.
Limitations
- The examples do not determine an individual’s final liability, benefit, eligibility or optimal financial decision. State rules and personal circumstances may change the result.
- Check the current primary-source release and applicable year before making a contribution, filing a return, or changing benefits.
Sources
- SSA 2027 changes, Social Security Administration
- 2026 Trustees Report table V.C1, Social Security Administration
- Employer tax guide, Internal Revenue Service
- Household employment taxes, Internal Revenue Service
Professional guidance: 2027 FICA Rates & Confirmed Social Security Wage Base is for tax education and planning only and is not tax, legal, accounting, or filing advice. Verify current rules with the relevant tax authority or a qualified tax professional.