2019 Payroll Tax Updates: Social Security Wage Base, Medicare & FICA Tax Rates

Payroll Tax Updates

On October 11, 2018, the Social Security Administration made its annual announcement regarding adjustments to the Social Security wage base (tax cap on maximum earnings) used in calculating the Social Security portion of payroll taxes.  For 2019, the base will increase to $132,900.  That is an increase of $4,500 from the 2018 base, which was $128,400.  This means that taxable wages up to $132,900 will be subject to the 6.2% Social Security tax when calculating payroll taxes.

The Medicare Tax rate will remain the same at 1.45% and will apply to all earned wages (there is no threshold limits for Medicare taxes).  Any employees earnings in excess of $200,000 (single filers, $250,000 married filing jointly) will also be subject to a 0.9% additional Medicare tax, which remains unchanged from 2018.  Unlike other payroll taxes, employers do not have to match the additional Medicare Tax rate, so they only have to pay 1.45% for all covered wages.

Federal Insurance Contributions Act (FICA) taxes are the combination of Social Security and Medicare taxes.  Below is a table outlining the FICA taxes for payroll tax calculations by payor type and eligible wage thresholds:

2019 WAGES
PAYOR ≤ $132,900 $132,901.99 – $200,000 (single, $250k joint) >$200,000 (single, $250k joint)
Employer 7.65% 1.45% 1.45%
Employee 7.65% 1.45% 2.35%
Self-Employed 15.3% 2.9%


Correctly calculating all of your employees’ and employer portion of payroll taxes is vital to maintaining compliance and also ensuring employee satisfaction and engagement.  It requires making certain to account for pre-tax and other deductions, withholding allowances and utilizing the varying income thresholds to ensure the right amounts are withheld and accurate tax payments are made on time on behalf of your workers and your company.  With over 20 years in business, CheckmateHCM has the payroll expertise and intuitive software providing you with peace of mind to get the job done right.

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