Social Security Tax Threshold Rises

The Social Security withholding “FICA” tax of 6.2 percent will apply to salary up to $118,500, up from $117,000. For FERS employees, the tax cuts off that figure but CSRS Offset employees continue paying it, with the money going into the federal retirement fund instead. Regular CSRS employees don’t pay Social Security taxes. There is no limit on the 1.45 percent Medicare tax paid by all employees, a tax that sometimes is presented together with the FICA tax and labeled as the Social Security tax, even though only the FICA portion goes to Social Security.