Federal Insurance Contributions Act (FICA) tax is a United States tax levied in an equal amount on employees and employers to fund federal programs for retirees, disabled, and children of deceased workers. The FICA taxes support Social Security and Medicare, A tax is a compulsory charge or other levy imposed on an individual or a legal entity by a state or a functional equivalent of a state (e. ... Social Security in the United States is a social insurance program funded through a dedicated payroll tax. ... Medicare is a health insurance program for the elderly and disabled in the USA. It was first passed on July 30, 1965 by President Lyndon Johnson as amendments to Social Security legislation. ...

Social Security benefits include old-age, survivors, and disability insurance or OASDI. Medicare is the hospital insurance portion . The term disability, as it is applied to humans, refers to any condition that impedes the completion of daily tasks using traditional methods. ... Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of potential financial loss. ...

For 2005, the Social Security Portion is 6.2% of wages up to $90,000; for 2006 this amount increases to $94,200. This limit, known as the "FICA-wage-base", goes up each year based on average national wages and in general at a faster rate than the Consumer Price Index (CPI-U). The Medicare portion is 1.45% of wages with no limit. A wage is the amount of money paid for some specified quantity of labour. ...

If a worker starts a new job halfway through the year and has already earned the wage base limit for Social Security, the new employer is not allowed to stop withholding it until the wage base limit has been earned with them. There are some cases, such as a successor-predecessor transfer, in which the payments that have already been withheld can be counted toward the year-to-date total. Employment is a contract between two parties, one being the employer and the other being the employee. ... In the US, this refers to a deduction from an employees salary by an employer for federal, state and local tax liabilities. ...

If a worker has overpaid toward Social Security by having more than one job or by having switched jobs during the year, that worker will get a refund when he files for income taxes. In the United States, taxpayers will get a tax refund, a refund on their U.S. income tax, if the tax they owe is less than the sum of: The total amount of refundable tax credits that they claim. ... This article needs to be cleaned up to conform to a higher standard of quality. ...

See also

• Form W-2