The Social Security (SS) wage base increases to $142,800 for 2021, up from $137,700. Wages and self-employment income above this threshold aren’t subject to SS tax. The Federal Insurance Contributions Act (FICA) imposes SS tax and a Medicare tax on employees, employers and the self-employed. There’s no threshold for Medicare tax; all wages and self-employment income are subject to the tax. The FICA tax rate for employees and employers is 7.65%: 6.2% for SS and 1.45% for Medicare. The self-employed pay both the employee and employer portions. Wages or self-employment income above $200,000 ($250,000 for joint filers, $125,000 for separate filers) are subject to an additional 0.9% Medicare tax. Call or visit our website for more information! www.mjscpa.com/
