What Is The FICA Deduction On Payroll Checks?
FICA taxes are withholdings mandated by the Federal Insurance Contribution Act. FICA withholdings are contributions to the Social Security and Medicare systems, which provide financial support and medical coverage after retirement or in the event of a disability.Social Security ContributionsSocial security contributions are part of the federal program which provide financial support for those who qualify upon retirement. Most retired workers will qualify if they have contributed to social security during their entire working life.Medicare ContributionsMedicare contributions support the federal medical insurance program for senior citizens and some disabled citizens who are otherwise uninsured.CalculationSocial security taxes are withheld at a rate of 6.2% of taxable income. Medicare withholding is 1.45% of taxable income.Employer ContributionEmployers are required to match social security and Medicare withholdings.
