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The increase in 2025 will perhaps have the biggest impact on those earning between $168,600 and $176,100 per year, as you'll face Social Security tax on income that wasn't previously taxed in 2024.
However, the amount of income subject to the Social Security portion of the FICA tax will change next year. The maximum taxable earnings is currently $168,600 but will rise to $176,100 in 2025.
The general Social Security earnings-test limit in 2025 is $23,400 (up from $22,320 in 2024). ... earnings millions of dollars will have the same Social Security tax burden. ... benefit is tied to ...
The new wage base limit, which will be in effect in 2025, is $176,100, up from the $168,600 limit in 2024. This means more income of some workers will be subject to Social Security payroll taxes.
It is also the maximum amount of covered wages that are taken into account when average earnings are calculated in order to determine a worker's Social Security benefit. In 2020, the Social Security Wage Base was $137,700 and in 2021 was $142,800; the Social Security tax rate was 6.20% paid by the employee and 6.20% paid by the employer.
In 2025, the maximum monthly Social Security benefit is $5,108. After years of paying Social Security payroll taxes, it's a nice financial safety net in retirement when income sources could be ...
For 2025, the Social Security wage base — the cap on earnings subject to Social Security tax — will rise to $176,100, meaning only income up to that amount is taxed for Social Security.
The good news is that the earnings-test limits are going up in 2025 from $22,320 to $23,400. ... In 2025, the wage cap is rising from $168,600 to $176,100. That means higher earners will pay ...