Social Security Tax (OASDI)

Social Security tax, formally Old-Age, Survivors, and Disability Insurance (OASDI), is the larger half of FICA. Employees pay 6.2 percent of their wages and employers match it, so 12.4 percent flows into the program for each worker. Unlike Medicare tax, Social Security tax stops once your wages for the year reach the Social Security wage base, so high earners pay it only on the capped portion of their pay.

Because of that cap, the tax is regressive at the top: someone earning twice the wage base pays the same Social Security tax as someone right at it. The tax is withheld automatically from each paycheck and is not reduced by the standard deduction or by traditional 401(k) contributions. The ceiling it applies to is the Social Security wage base, which rises in most years. Our paycheck playbook shows where Social Security tax lands in your take-home pay.