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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. [1] [2] A person with $10,000 of gross income had $620.00 withheld as Social Security tax from his check and the employer sent an additional $620.00. A person with $130,000 of ...
When it comes to Social Security, though, once you hit the limit, called the wage base limit, then you are done paying the 12.4% payroll tax on the rest of your wages. The wage base limit for 2024 ...
The good news is that not all income is subject to Social Security payroll taxes -- it's only up to a certain amount, called the "wage base limit." The wage base limit in 2024 is $168,600, so any ...
There is also a cap on wages subject to Social Security tax. It changes from year to year; the max Social Security taxable income for tax-year 2023 is $162,300, and for 2024 it’s $168,600.
[a] [9] The taxation limit in 2020 was $137,700 of gross compensation, resulting in a maximum Social Security tax for 2020 of $8,537.40. [7] This limit, known as the Social Security Wage Base, goes up each year based on average national wages and, in general, at a faster rate than the Consumer Price Index (CPI-U).
In 2024, you'd have owed a 6.2% tax on all of your income up to $168,600, and anything above that wouldn't have been subject to Social Security tax. In 2025, with the wage base limit going up to ...
Social Security tax: Both you and your employer contribute 6.2 percent of your wages up to a capped amount called the taxable maximum ($168,600 in 2024). This cap means that high-income earners ...
The wage base limit is the magic number to know. ... Earnings above the wage base limit aren't subject to Social Security taxes each year, so they don't count toward calculating your benefit ...