Federal Insurance Contributions Act is a United States federal payroll contribution directed towards both employees and employers to fund Social Security and Medicare.
FICA contributions are withheld from a wage earner's gross pay, the amount depends on gross wages. FICA taxes are automatically taken out of your paycheck.
FICA tax is mandatory for nearly all US employees, including resident aliens and many nonresident aliens. It doesn’t matter whether you work part-time or full-time.
College students are exempt from paying FICA taxes on the wages they earn from an on-campus job. Exemptions also apply to some nonresident aliens.
The current FICA tax rate is 15.3%, which is the total of 7.65% of your income paid by you and 7.65% paid by your employer. 12.4% for Social Security tax and 2.9% for Medicare tax.
FICA taxes are calculated as a percentage of the employees wages. To calculate FICA withholding, you must take the employee's gross pay and multiply it by the employee rate of 7.65%.
Employers must send a quarterly payroll tax report to the IRS on Form 941, including information FICA taxes withheld from employee pay & employer portion of those taxes that must be paid.