Every year, the Social Security Administration (SSA) updates the maximum amount of income that can be taxed for Social Security.
This limit affects both employees and self-employed workers across the United States.
For 2025, the maximum taxable earnings have increased again, which means higher-income earners will contribute more to the Social Security program.
What Is the Maximum Social Security Tax for 2025?
For 2025, the maximum taxable earnings for the Social Security portion of payroll taxes is $176,100.
This figure is set each year by the SSA based on changes in the national average wage index.
Employees pay 6.2 percent of their earnings up to that limit.
That means the maximum employee Social Security tax for 2025 is $10,918.20.
Employers pay an equal amount, bringing the combined total contribution to $21,836.40 per employee.
If you are self-employed, you pay both portions — the employer and employee share — for a total Social Security rate of 12.4 percent on the first $176,100 of your net earnings.
That makes the maximum self-employment Social Security tax for 2025 also $21,836.40.
How Does the Social Security Wage Base Work?
The Social Security wage base is the upper limit on earnings that can be taxed for Social Security benefits.
Wages above this limit are not subject to the 6.2 percent Social Security tax.
However, there is no limit for the Medicare portion of payroll taxes, which continues to apply to all earnings.
Each year, the SSA reviews wage growth across the country and adjusts the wage base to maintain funding for the Social Security trust fund.
In 2024, the limit was $168,600, so the 2025 level reflects an increase of $7,500 due to rising national wages.
What Is the Total FICA Tax Rate in 2025?
The Federal Insurance Contributions Act (FICA) combines two taxes: Social Security (6.2 percent) and Medicare (1.45 percent).
Together, employees pay 7.65 percent on wages up to the Social Security wage base and continue to pay 1.45 percent Medicare tax on all wages above it.
Employers match these contributions.
For high earners, there is also an Additional Medicare Tax of 0.9 percent on wages over $200,000 for single filers or $250,000 for married couples filing jointly.
This extra Medicare tax does not apply to employers.
How Does the Wage Base Increase Affect Workers and Employers?
When the wage base increases, it directly affects higher-income earners who make more than the previous year’s limit.
For 2025, those earning above $168,600 will pay more in Social Security tax until they reach the new ceiling of $176,100.
For example, an employee who earns $180,000 will pay the full $10,918.20 in Social Security tax, while their employer contributes the same amount.
For employers, the change means higher payroll tax costs for each employee who exceeds last year’s threshold.
This is important for budgeting, especially for companies with several high-earning workers.
What About Self-Employed People?
Self-employed individuals pay both the employer and employee shares through the Self-Employment Contributions Act (SECA).
This results in a 12.4 percent Social Security tax on earnings up to $176,100 plus 2.9 percent Medicare tax on all income.
However, self-employed workers can deduct the “employer” half of their SECA tax as an adjustment to income when filing their federal tax return.
The increase in the wage base means self-employed people earning above $168,600 will pay up to $930 more in 2025 compared with 2024.
How Does the Maximum Tax Relate to Your Future Benefits?
The Social Security tax you pay builds your record of covered earnings, which determines your future retirement, disability, and survivor benefits.
Only wages up to the annual wage base are counted toward your benefit calculation.
Any income above that level does not increase your future benefit amount.
This means that even though you stop paying Social Security tax on income over $176,100, your benefit formula already caps the earnings used to calculate benefits at that same limit.
Will the Wage Base Continue to Rise Each Year?
Yes. The wage base typically increases annually because it is tied to the national average wage index.
If wages rise across the country, the taxable maximum increases as well.
The SSA usually announces the new limit each October for the following year.
This adjustment ensures the Social Security system remains funded while keeping benefits aligned with changes in worker earnings nationwide.
Experts expect similar increases each year unless national wage growth slows significantly.
