Understanding the 2026 Social Security and Medicare Tax Limits

As we move into 2026, it’s important for employees, employers, and self‑employed individuals to stay informed about changes to federal payroll tax thresholds. One of the most significant updates this year involves the Social Security wage base limit—along with a reminder about how Medicare tax works for higher earners.

Social Security Taxable Earnings Increase for 2026

For 2026, the Social Security maximum taxable earnings limit has increased to $184,500.

This is up from $176,100 in 2025, meaning high‑earning employees will pay Social Security tax on an additional $8,400 of income.

Workers and employers each pay 6.2% Social Security tax on wages up to that limit. Self‑employed individuals pay the full 12.4%.

Medicare Tax: No Income Cap

Unlike Social Security, Medicare tax does not have a maximum earnings limit. All covered wages are subject to:

• 1.45% Medicare tax withheld from employees,

• 1.45% paid by employers,

• or 2.9% total for self‑employed individuals.

Additional Medicare Tax for High Earners

There’s one more important consideration:

Once a taxpayer’s wages exceed $200,000 in a calendar year, they become subject to the Additional Medicare Tax of 0.9% on earnings above that threshold.