Are FICA and Medicare Tax the Same? Rates, Surtax, and SECA

FICA and Medicare tax are not the same thing, but they overlap: Medicare tax is one of the two taxes collected under FICA. The Federal Insurance Contributions Act requires employers to withhold a combined 7.65% from your wages — 6.2% for Social Security and 1.45% for Medicare — and to match that amount from their own funds.¹ So every dollar of Medicare tax you pay is a FICA tax, but not every FICA tax is a Medicare tax. The other, larger half funds Social Security.

What FICA Actually Covers

FICA is the statute; it authorizes the collection of two distinct taxes that pay for two entirely different programs. The first is Old-Age, Survivors, and Disability Insurance, commonly called Social Security tax. The second is the Hospital Insurance tax, commonly called Medicare tax.¹ Both flow through the same payroll withholding, but the money lands in separate trust funds and pays for separate benefits.

Your W-2 keeps them separate. Social Security tax withheld appears in Box 4. Medicare tax withheld appears in Box 6.² Pay stubs sometimes lump the two together under a single “FICA” line, which is where the confusion starts. The label is technically accurate, since both are FICA taxes, but it hides the fact that each has its own rate, its own cap, and its own rules.

How Medicare Tax Differs From the Social Security Half

The two taxes are structured differently in ways that matter on your paycheck.

Rates. The Social Security portion is 12.4% of covered wages, split 6.2% employee and 6.2% employer. The Medicare portion is 2.9%, split 1.45% and 1.45%.³ Social Security is roughly four times larger.

Wage cap. This is the biggest structural difference. Social Security tax stops once your annual wages hit a set limit. For 2026, that limit is $184,500, and the maximum any employee can owe in Social Security tax for the year is $11,439.⁴² After you cross that number, the 6.2% withholding stops for the rest of the calendar year, and paychecks get noticeably larger. Medicare tax has no such cap. The 1.45% applies to every dollar of covered wages, no matter how much you earn.³

The Social Security wage base adjusts each year for wage growth. It was $168,600 in 2024, $176,100 in 2025, and $184,500 in 2026.¹

An extra Medicare tax on high earners. Medicare has a wrinkle Social Security does not. An Additional Medicare Tax of 0.9% applies to wages above a threshold set by filing status:⁵

$200,000 for single filers
$250,000 for married filing jointly
$125,000 for married filing separately

The 0.9% is entirely the employee’s burden. Employers do not match it.⁶ A single filer earning above $200,000 effectively pays 2.35% in Medicare tax on the wages above that line (1.45% plus 0.9%), while the employer keeps paying 1.45%.

One quirk causes reconciliation issues at tax time. Employers are required to start withholding the extra 0.9% once your wages with them reach $200,000, regardless of your actual filing status.² If you file jointly, your real threshold is $250,000, so you may have been over-withheld. If you file married filing separately, your real threshold is $125,000, and you may owe more than what was withheld. The final math happens on your return.

These thresholds are written into the statute as fixed dollar amounts. They are not indexed for inflation and have not changed since 2013.

The “3.8% Medicare Surtax” Is Not FICA

If you have heard the phrase “3.8% Medicare surtax” applied to investment income, that is not a Medicare tax in the FICA sense. Its actual name is the Net Investment Income Tax, and it is a separate tax reported on your income tax return, not withheld through payroll.⁷

The NIIT applies to the lesser of your net investment income or the amount your modified adjusted gross income exceeds the same threshold dollars used for the Additional Medicare Tax. It covers interest, dividends, capital gains, and rental income. The 0.9% Additional Medicare Tax, by contrast, covers wages and self-employment income. A high earner can owe both, but the two never hit the same dollar of income.⁷ Calling the NIIT a Medicare tax leads people to assume their investment income affects their FICA obligations. It does not.

What Each Tax Actually Pays For

The two halves of FICA fund different programs, which is the underlying reason they are tracked separately.

The Social Security portion funds retirement checks for workers and their spouses, disability payments, and survivor benefits for dependents. The Medicare portion funds Medicare Part A, which covers hospital stays, skilled nursing care, and hospice.

Paying FICA is also how you qualify for those benefits later. In 2026, you earn one Social Security credit for every $1,890 in covered wages, up to four credits a year.⁴ You need 40 credits, roughly ten years of work, to qualify for Social Security retirement benefits and for premium-free Medicare Part A at 65.⁸ Workers who fall short of 40 credits may not receive Social Security retirement income and would have to pay premiums for Part A instead of getting it free.

If You Are Self-Employed

Self-employed workers pay both the employee and employer halves. The self-employment tax rate is 15.3%, which is the full 12.4% Social Security tax plus the full 2.9% Medicare tax.⁹ You calculate it on Schedule SE with your Form 1040 and can deduct the employer-equivalent half when figuring your adjusted gross income.¹⁰

The same structural differences apply. The Social Security portion stops at the $184,500 wage base, counting any W-2 wages first, so a person earning $100,000 in salary and $85,500 in freelance income would owe Social Security tax on only $84,500 of the freelance side.¹¹ The Medicare portion has no cap and continues on all self-employment earnings. The 0.9% Additional Medicare Tax also applies to self-employment income above the filing-status thresholds.⁹

Terminology varies here. When you are self-employed, the tax is called “self-employment tax” rather than FICA, but it funds the same two programs at the same combined rate. The mechanism is different; the destination is the same.

The Short Version

FICA is the umbrella. Under it sit two taxes: Social Security (6.2% employee / 6.2% employer, capped at $184,500 of wages in 2026) and Medicare (1.45% / 1.45%, uncapped, plus a 0.9% employee-only surcharge on high wages). When someone says “FICA” they usually mean both. When someone says “Medicare tax” they mean only the second one. The pay stub line that combines them is a convenience label, not a single tax.

1
Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates
2
Internal Revenue Service. General Instructions for Forms W-2 and W-3 (2026)
3
Office of the Law Revision Counsel. 26 USC 3101 – Rate of Tax
4
Social Security Administration. 2026 Cost-of-Living Adjustment (COLA) Fact Sheet
5
Internal Revenue Service. Questions and Answers for the Additional Medicare Tax
6
Office of the Law Revision Counsel. 26 USC 3111 – Rate of Tax
7
Internal Revenue Service. Net Investment Income Tax
8
Social Security Administration. How You Earn Credits
9
Office of the Law Revision Counsel. 26 USC 1401 – Rate of Tax
10
Internal Revenue Service. Self-Employment Tax (Social Security and Medicare Taxes)
11
Social Security Administration. If You Are Self-Employed