Social security and Medicare?

Question

I understand that every employee has to pay 6.2% for social security and 1.45% for Medicare and the employer also has to pay the same percentage.

My question is : Self employed people pay social security only for the first $94,200 that they have earned in that tax year.
Is there some such limit for employees also or do they (and the employer for his share) have to pay soc. sec. for the entire amount?

Answer 1

Yes, the limit is the same for employees. If you change jobs during the year and pay in over the limit between the two jobs, you can claim the extra back when you file your tax return. The second job would have continued to take out until THAT job reached the limit, since they wouldn't know that you were over the limit in total.

The second employer would continue to pay matching funds until the end of the year, or until you reached the limit at THAT job.

Answer 2

Same rule for employees. When your income hits the cap for the year, the 6.2% will stop being deducted until the end of the year. The 1.45% Medicare deduction continues as it is not capped.

Answer 3

The same maximum salary cap for self employed people applies to employees as well.