Payroll Tax Calculator 2026

What is How to Use the Payroll Tax Calculator?

Payroll taxes fund Social Security and Medicare through FICA (Federal Insurance Contributions Act), established under IRC §§ 3101 and 3111. Employees pay 7.65% (6.2% Social Security + 1.45% Medicare), employers match it dollar for dollar, and self-employed workers pay both halves as 15.3% self-employment tax under IRC § 1401. For 2026, the Social Security wage base is $184,500 (announced annually by the Social Security Administration). This means the 6.2% Social Security tax applies only to the first $184,500 of wages — income above this limit is not subject to Social Security tax. The 1.45% Medicare tax has no wage cap and applies to all earned income. Additionally, the 0.9% Additional Medicare Tax (IRC § 3101(b)(2), enacted by the Affordable Care Act) applies to employee wages above $200,000 (single), $250,000 (MFJ), or $125,000 (MFS) — this portion is employee-only and is not matched by the employer. Self-employed individuals calculate their tax using Schedule SE, applying the 15.3% rate to 92.35% of net self-employment income (the 92.35% factor mirrors the employer-side deduction that employees receive automatically). One-half of the regular SE tax (the 15.3% portion, not the Additional Medicare Tax) is deductible as an above-the-line deduction on Schedule 1 under IRC § 164(f). This calculator breaks down every component for 2026.

How to Use

1. Enter your annual wages or net self-employment income.
2. Select your employment type — W-2 Employee or Self-Employed.
3. Choose your filing status — this affects the Additional Medicare Tax threshold.
4. Review your FICA breakdown: Social Security, Medicare, and Additional Medicare Tax.
5. For employees, see the employer match and true labor cost.
6. For self-employed, see the SE tax and your 50% deduction.

Tips & Best Practices

• The 2026 Social Security wage base is $184,500 — once your wages exceed this, SS withholding stops.
• Self-employed workers can deduct half of their SE tax on Schedule 1, reducing AGI.
• The Additional Medicare Tax (0.9%) applies only to the employee side — employers do not match it.
• FUTA is employer-only: 0.6% on the first $7,000 of each employee's wages (after SUTA credit).
• If you work multiple jobs and exceed the SS wage base combined, you can claim a credit for excess SS withholding on your tax return.

Frequently Asked Questions

Real-world Examples

Annual wages:                      $85,000
Employment type:                   W-2 Employee
Filing status:                     Single
2026 SS wage base:                 $184,500

Employee FICA:
  Social Security (6.2%):  $85,000 × 6.2% = $5,270
  Medicare (1.45%):        $85,000 × 1.45% = $1,233
  Additional Medicare:     $85,000 < $200,000 → $0
  Total employee FICA:     $6,503

Employer match:
  Social Security (6.2%):  $5,270
  Medicare (1.45%):        $1,233
  FUTA (0.6% on $7,000):   $42
  Total employer cost:     $6,545

Combined FICA: $13,006
True cost of employment: $85,000 + $6,545 = $91,545
Effective employee rate: 7.65%
SS wage base remaining: $184,500 − $85,000 = $99,500

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