The two FICA taxes
FICA is two separate taxes, and each is split evenly between the worker and the contractor. IRS Publication 15 (2026) sets the rates:
- Social security: 6.2% from the employee plus 6.2% from the employer, 12.4% combined.
- Medicare: 1.45% from the employee plus 1.45% from the employer, 2.9% combined.
What you withhold from an employee's pay is 6.2% for social security and 1.45% for Medicare. The trap: 12.4% is the combined rate, not the withholding, and 7.65% (6.2% + 1.45%) is both taxes together, not the social security rate.
Wage base: social security stops, Medicare does not
Social security applies only up to the 2026 wage base of $184,500 (Publication 15). Medicare has no wage base limit, so every covered dollar is taxed at 1.45%. Stopping Medicare at $184,500 is a listed common error. Keep the other big numbers apart: $200,000 is the Additional Medicare Tax threshold, $7,000 is the FUTA wage base, and $50,000 is the depositor lookback threshold.
Worked example: a superintendent paid $190,000 has social security withheld on $184,500 only: 184,500 × 0.062 = $11,439. Taxing all $190,000 ($11,780) ignores the cap.
The employer's share
The contractor matches both taxes, so its own cost is 6.2% + 1.45% = 7.65% of wages up to the base. On a carpenter earning $50,000: 50,000 × 0.0765 = $3,825. The trap: $7,650 (15.3%) is employee plus employer together; $3,100 leaves out Medicare; $725 leaves out social security.
Form 941 uses combined rates
Form 941 (Rev. March 2026) reports both halves at once. Line 5a multiplies taxable social security wages by 0.124, so $100,000 of wages goes in as $12,400. Medicare is reported separately on line 5c at 0.029. Two traps: multiplying line 5a by only 6.2% ($6,200), and folding Medicare into line 5a ($15,300).