Payroll Tax Calculator
Calculates the combined US federal payroll tax (Social Security plus Medicare, jointly known as FICA) owed on a given block of wages, using the specified employee-side rates. Useful for paycheck planning, comparing self-employment to W-2 take-home, and verifying that an employer has withheld the correct FICA amount.
Last updated: May 2026
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About this calculator
The formula is tax = wages × (socialSecurityRate + medicareRate) ÷ 100. For 2024 the statutory employee rates are Social Security 6.2% and Medicare 1.45%, for a combined FICA rate of 7.65%. The employer pays a matching 7.65% on top, so the total tax the government collects on a dollar of wage is 15.3% — a self-employed person pays both halves themselves as Self-Employment tax. Social Security is capped at the annual wage base ($168,600 for 2024); wages above the base are not subject to the 6.2% OASDI portion. Medicare has no wage cap, and an Additional Medicare Tax of 0.9% applies to wages above $200,000 single / $250,000 married filing jointly — that surcharge is employee-only (no employer match) and is NOT modeled by this calculator unless you fold it into the medicareRate field manually. Common edge cases: entering a wage above $168,600 with the 6.2% Social Security rate overstates the SS portion (you should pro-rate the rate down once the cap is hit, or only enter wages up to the cap); entering high-income wages without including the 0.9% Additional Medicare understates tax; the calculator does NOT cover federal income tax withholding, state income tax, state disability (CA/NJ/RI/etc.), or local payroll taxes like NYC MCTMT. For employer-side total payroll cost, double the result. Payroll tax is regressive on Social Security (flat rate up to cap, zero above) but progressive on Medicare due to the surcharge above the threshold.
How to use
Example 1 — Standard W-2 employee, mid-income. You earn $75,000 in gross wages and want to know your FICA withholding. Enter wages = 75000, socialSecurityRate = 6.2, medicareRate = 1.45. Result: $5,737.50. Verify: 75000 × 0.0765 = 5737.50 ✓. Your employer pays another $5,737.50 on top, and the IRS receives $11,475 total. This is independent of your federal income tax withholding, which is calculated separately on a W-4 basis. Example 2 — High earner above Social Security cap. You earn $250,000 in 2024. Social Security applies only to the first $168,600, so the effective combined rate is lower than 7.65%. Enter wages = 168600, socialSecurityRate = 6.2, medicareRate = 1.45 → $12,897.90 of base FICA on capped wages. Then re-run for the remaining 81,400 above the cap at medicare-only: wages = 81400, socialSecurityRate = 0, medicareRate = 1.45 → $1,180.30. Add Additional Medicare 0.9% on the $50,000 above the $200,000 single threshold: 50000 × 0.009 = $450. Total payroll tax = 12897.90 + 1180.30 + 450 = $14,528.20. This staged calculation is how you handle the SS cap and 0.9% surcharge with a single-rate tool.
Frequently asked questions
What is the difference between FICA, payroll tax, and self-employment tax?
FICA (Federal Insurance Contributions Act) is the legal name for the combined Social Security and Medicare tax on wages — 6.2% + 1.45% = 7.65% on the employee, with a matching 7.65% paid by the employer. "Payroll tax" is a broader umbrella term that usually means FICA but in policy discussions can also include federal unemployment (FUTA), state unemployment (SUTA), and any local wage taxes. Self-Employment (SE) tax is what an independent contractor or sole proprietor pays in place of FICA — because there is no employer to match, the self-employed person pays both halves, 15.3% on the first $168,600 of net earnings in 2024 plus 2.9% Medicare on everything above (with the 0.9% Additional Medicare surcharge layered on at $200k/$250k). SE tax is computed on 92.35% of net self-employment earnings, slightly lower than the gross, because the calculation effectively gives you back the employer-deductible half. Income tax is a separate layer that applies on top of all of these.
Why does Social Security have a wage cap but Medicare does not?
Social Security is structured as social insurance with a benefit formula that is itself capped — the contribution and benefit base ($168,600 for 2024, adjusted each year for wage growth) ties the wages on which you pay tax to the wages on which you eventually accrue retirement benefits. Earning above the cap does not increase your future Social Security benefit, so Congress chose not to tax it for that program. Medicare was reformed in 1993 to remove its wage cap entirely (Omnibus Budget Reconciliation Act), partly to shore up the Hospital Insurance trust fund, and the 0.9% Additional Medicare surcharge was added by the Affordable Care Act in 2013 to apply specifically to high earners. The practical effect is that Social Security is regressive (flat below the cap, zero above) while Medicare is progressive (flat everywhere, with a high-earner surcharge layered on top). For payroll-tax planning, the cap is the single biggest source of nonlinearity in the system.
Common mistakes when calculating payroll tax?
First, double-counting the employer half — FICA shows up on your pay stub at 7.65%, not 15.3%, because the employer's match never flows through your wages. Quoting the 15.3% number for an employee's take-home calculation is incorrect; quote it only when discussing total tax cost or self-employment. Second, ignoring the Social Security wage base — running the 6.2% rate on a $250,000 salary overstates Social Security by about $5,050. Third, forgetting the 0.9% Additional Medicare on high incomes; it kicks in at $200,000 single / $250,000 MFJ and is the employee's responsibility (no employer match, no withholding adjustment unless you submit a new W-4). Fourth, conflating payroll tax with federal income tax — they are stacked, not substitutes, and W-4 withholding only addresses the income tax piece. Fifth, ignoring state payroll equivalents: CA SDI (1.1% in 2024, no cap), NJ TDI/FLI, NY SDI/PFL, OR statewide transit (0.1%) — these are real payroll deductions a national calculator misses.
Do I owe payroll tax on tips, bonuses, RSUs, severance, and 401(k) contributions?
Tips reported to your employer are wages and are subject to full FICA — your employer collects it from your paycheck along with reported tip income. Cash bonuses are wages and fully FICA-taxable; they are usually withheld at the supplemental federal rate (22% for income tax) but FICA is still 7.65%. RSUs become wages at vesting at their fair market value on the vest date and are fully FICA-taxable (this often pushes a high earner above the Social Security cap and into Additional Medicare territory in vesting months). Severance is generally wages and FICA-taxable except in limited circumstances. Traditional 401(k) contributions REDUCE federal income tax withholding but do NOT reduce FICA — your full pre-401(k) wage is the FICA base, which is why a 401(k) contribution does not reduce your Social Security earnings record. Roth 401(k) contributions are the same: FICA-taxed up front. HSA contributions through a cafeteria-plan payroll deduction DO reduce FICA wages, which is why HSAs are sometimes called the only triple-tax-advantaged account.
When should I not use this calculator?
Skip it when modeling self-employment income — use a dedicated SE-tax calculator that handles the 92.35% net-earnings adjustment, the deduction of half the SE tax against income tax, and the proper SS cap. Skip it for high earners above the Social Security wage base ($168,600 for 2024) unless you manually pro-rate the SS rate or stage the calculation as in Example 2. Skip it for total tax planning — payroll tax is one of three or four stacked layers (federal income tax, state income tax, payroll tax, local tax), and this tool only handles the FICA piece. It also does not compute employer payroll cost (FUTA + SUTA + workers' comp + benefits); for employer-side budgeting you need a fully loaded labor-cost calculator. Finally, do not use it for retirement-benefit planning: the wages-paid-tax-on figure does not directly translate to the SSA's primary insurance amount (PIA), which uses the 35-year indexed-earnings AIME formula.