The Social Security Administration (SSA) announced on Thursday, October 12, that the 2024 social security wage base will be $168,600, which is an increase of $8,400 from $160,200 in 2023 (view the SSA Fact Sheet).
As in prior years, there is no limit to the wages subject to the Medicare tax; therefore, all covered wages are still subject to the 1.45% tax. As in 2023, wages paid in excess of $200,000 in 2024 will be subject to an extra 0.9% Medicare tax that will be withheld only from employees’ wages. Employers will not pay the extra tax.
The FICA tax rate, which is the combined social security tax rate of 6.2% and the Medicare tax rate of 1.45%, will be 7.65% for 2024 up to the social security wage base.
The maximum social security tax employees and employers will each pay in 2024 is $10,453.20, an increase of $520.80 from $9,932.40 in 2023.
The social security wage base for self-employed individuals in 2024 will also be $168,600. There is no limit on covered self-employment income that will be subject to the Medicare tax.
The self-employment tax rate will be 15.3% (combined social security tax rate of 12.4% and Medicare tax rate of 2.9%) up to the social security wage base. In 2024, the maximum social security tax for a self-employed individual will be $20,906.40.