FICA payroll tax is two pieces: Social Security at 6.2% up to an annual wage cap, plus Medicare at 1.45% on all wages. MIN applies the cap, and a simple sum combines them.
The example
$150k of wages against a $168,600 cap.
| A | B | |
|---|---|---|
| 1 | Item | Value |
| 2 | Wages (YTD) | 150000 |
| 3 | FICA | $11,475 |
The formula
The formula:
How it works
How it works:
MIN(wages, cap)limits the Social Security base to the annual wage cap, taxed at 6.2%.- Medicare is 1.45% on all wages, with no cap.
- Add the two for the employee’s FICA withholding; the employer matches the same amount.
- High earners owe an extra 0.9% Additional Medicare above a threshold — add it with a MAX term.
Rates and the cap change annually. Put the Social Security wage cap and the rates in labeled input cells (not hard-coded) so a yearly update is one edit. The figures here are illustrative — confirm the current year’s cap and any additional-Medicare threshold.
Try it: interactive demo
YTD wages and SS cap.
Variations
Social Security only
Capped 6.2%:
Medicare only
Uncapped 1.45%:
Additional Medicare
0.9% over threshold:
Pitfalls & errors
Cap is annual, cumulative. Apply it to year-to-date wages, not a single paycheck in isolation.
Update yearly. The wage cap and thresholds change each year — keep them in input cells.
Employer match. The employer pays the same FICA again; this formula is the employee share.
Practice workbook
Frequently asked questions
How do I calculate FICA withholding in Excel?
How does the Social Security wage cap work?
What about Additional Medicare Tax?
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