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What is the self-employed person's FICA tax rate for 2018?

The self-employed person's FICA tax rate for 2018 (January 1 through December 31, 2018) is 15.3% on the first $128,400 of net income and then 2.9% on the net income in excess of $128,400. (In 2017 it was 15.3% on the first $127,200 and then 2.9% on the net income in excess of $127,200.)

The self-employed person's FICA tax rate for 2018 includes all of the following:

  • the employee's portion of the Social Security tax, which is 6.2% of the first $128,400 of net income
  • the employer's portion of the Social Security tax, which is 6.2% of the first $128,400 of net income
  • the employee's portion of the Medicare tax, which is 1.45% of all net income (no cap or limit on net income)
  • the employer's portion of the Medicare tax, which is 1.45% of all net income (no cap or limit on net income)

Expressed another way, the self-employed person's FICA tax rate for the year 2018 consists of the Social Security tax of 12.4% (6.2% + 6.2%) of the first $128,400 of net income plus the Medicare tax of 2.9% (1.45% + 1.45%) of every dollar of net income. This means that in 2018 a self-employed person's net income up to $128,400 will have a FICA tax of 15.3% (the 12.4% of Social Security tax plus the 2.9% of Medicare tax). The amount in excess of $128,400 will be subject to the 2.9% Medicare tax. A self-employed person having net income of exactly $128,400 in 2018 would have to remit FICA taxes of $19,645.20 ($128,400 X 0.153).

There is also a Medicare surtax that applies to higher income taxpayers. Information on the Medicare surtax and other income tax information can be found at www.irs.gov.