PAYROLL GLOSSARY
FICA
Definition: FICA is the Federal Insurance Contributions Act payroll tax, which funds Social Security and Medicare.
For employees, FICA usually means two taxes taken directly from each paycheck: Social Security tax and Medicare tax. SSA explains that employers withhold these taxes from employee earnings and also pay a matching employer share. In 2026, the employee-side standard rate is 6.2% for Social Security up to the wage base and 1.45% for Medicare on all covered wages, for a combined 7.65% on most paychecks below the Social Security cap.
FICA is separate from federal income tax withholding. Your W-4 changes federal income tax withholding, but it does not change the standard Social Security or Medicare percentages. That is why many workers see FICA come out consistently even when their federal withholding varies after a W-4 update or a bonus check.
When you estimate take-home pay, treat FICA as the fixed payroll-tax layer and income-tax withholding as the variable layer that depends on salary, filing status, pay period, and W-4 inputs.