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2021 Fica Tax Rates with Phil Liberatore, CPA
Social Security and Medicare income limits and tax rates
FICA tax is a combination of a Social Security tax and a Medicare tax. The Social Security tax is assessed on wages up to $142,800 ($137,700 in 2020); the Medicare tax is assessed on all wages.
Self-employed individuals pay a self-employment tax which is the equivalent of FICA tax. For 2021, they will pay a 15.3% self-employment tax on the first $142,800 ($137,700 in 2020) of self-employment income.
The earnings limit for retirees under full retirement age is $18,960 ($18,240 in 2020). Social Security benefits will be reduced $1 for every $2 of earnings above this limit. There is no earnings limit for individuals at full retirement age.
www.liberatorecpa.com
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By Phil Liberatore
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Social Security and Medicare income limits and tax rates
FICA tax is a combination of a Social Security tax and a Medicare tax. The Social Security tax is assessed on wages up to $142,800 ($137,700 in 2020); the Medicare tax is assessed on all wages.
Self-employed individuals pay a self-employment tax which is the equivalent of FICA tax. For 2021, they will pay a 15.3% self-employment tax on the first $142,800 ($137,700 in 2020) of self-employment income.
The earnings limit for retirees under full retirement age is $18,960 ($18,240 in 2020). Social Security benefits will be reduced $1 for every $2 of earnings above this limit. There is no earnings limit for individuals at full retirement age.
www.liberatorecpa.com