Social Security taxes going to be increased for all workers in 2023
Social Security tax
Employees pay Social Security Taxes only on certain percentage of their income
Employees
Social Security Administration decides the wage limit to pay social security tax every year
Wage Limit
Wage base for the year 2022 is
$147,000
$147,000
In 2022 Social Security tax rate is
6.2%
for employees and employers.
12.4% for
self-employed.
Tax Rate
If your salary is $200,000/Yr, You are going to pay Social Security Tax only for $147,000
Example
In this scenario, your Social
Security
tax will be
$9,114
Example
2018- $128,400
2019- $132,900
2020- $137,700
2022- $147,000
2021- $142,800
Wage Base Limit for last 5 Years
If COLA will increase in 2023, Wage base limit will also increase.
COLA
Based on certain calculations by following the rules of SSA, $155,100 could be new wage base for 2023
$155,100
In this case, this new wage base will be $8,100 higher than wage base limit of 2023
$8,100
Your Social Security tax rate as an employee is 6.2%, so your social security tax in 2023 might be
$9616
$9,616
So you might be end up in paying $502 more Social Security tax by next year
$502