In 2025, a number of changes will affect our bank accounts and wallets. The maximum work income that can be taxed is increasing in 2025, despite the fact that the 12.4% tax on workers' earnings remains in effect.
Both employers and employees pay a portion of the social security tax. To reach the 12.4 percent that goes to Social Security, both must contribute 6.2 percent of the workers' income.
Although the maximum amount of taxed income has increased over time and will do so once more in 2025, the rate has stayed constant since 1990.
What is the highest income that will be subject to taxes in 2025? In 2025, $176,100 will be the highest amount of income that is taxable under Social Security.
Social Security taxes do not apply to income over this threshold. The chart below shows that the maximum amount has been rising gradually over the past ten years:
Employers are required to deduct Social Security taxes from employees' paychecks if they work more than one job in a year.
This implies that the entire amount of Social Security taxes withheld may be more than the upper limit. Employees who have more than the maximum amount of Social Security taxes withheld on their tax returns may be eligible for a refund from the IRS.