Social Security Component of FICA to Increase
The Social Security Administration announced the maximum earnings subject to the Social Security component of the FICA tax will increase for 2017 by $8,700. For 2017 the maximum Social Security tax paid by employers and employees will be $7,886.40 each, correlating to the formula of $127,2000 x 6.2%.
- A self-employed person with at least $127,200 in net self-employment earnings will pay $15,772.80, or the sum of $127,200 x 12.4% for the Social Security part of the tax
- The Medicare component remains 1.45% of all earnings. Individuals with earned income of more than $200,000, or $250,000 for married couples filing jointly) will pay an additional .9% in Medicare taxes.
Other 2017 cost-of-living adjustments can be found on the Social Security Administration website.