Social Security Tax Limit 2024

The Social Security Tax Limit for 2024 set by the Social Security Administration is an important factor for both employees and employers in the United States. This limit, also known as the “contribution and benefit base,” decides the maximum amount of earnings subject to Social Security tax.

For the year 2024, the Social Security Tax Limit is set at $168,600. It means that any income earned above this threshold is not subject to Social Security tax. The tax rate for Social Security in 2024 remains at 6.2% of earnings, as it has in previous years.

Employees contribute to the Social Security tax via deductions from their salaries, while employers also add an equal amount on behalf of their employees. Self-employed individuals are accountable for paying both the employer and employee portions of the tax.

The benefits of paying Social Security tax extend to various sections of society, including retirees, individuals with disabilities, widows, children, and others without heirs. These benefits provide financial aid in retirement, in cases of disability or injury preventing work, and to surviving spouses.

To calculate Social Security tax, individuals can use the tax rate of 6.2% applied to their gross taxable income. For example, if an employee’s gross income is $2,000, the Social Security tax would be $124 (6.2% of $2,000). This amount is deducted from the employee’s salary, with the balance paid to the employee.

The official website of the Social Security Administration, where individuals can find more information and resources related to Social Security tax, is https://www.ssa.gov/. It is managed by the Social Security Administration, which oversees the administration of Social Security programs and benefits in the United States.