The Social Security Administration has announced that the maximum earnings subject to the 6.2% FICA tax rises to $113,700 for 2013. It had been $110,100 for 2012. That same cap applies to the 12.4% retirement portion of self-employment tax.
The maximum FICA tax rises by as much as $2,425 because the temprorary reduction in employee FICA to 4.2% expires at the end of this year. The maximum FICA withholding for 2013 will be $7,049.40, up from the 2012 maximum of $4624.20.
The 2.9% medicare tax, split between employees and employers, has no wage or self-employment income cap.
Tags: FICA base
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[...] adjustments. In addition to the new limits for 2013 pension contributions and the new FICA base, the IRS has issued other inflation adjustments (Rev. Proc. 2012-41) for next year. One key [...]