The Social Security wage base is going up for 2026. Starting January 1, 2026, the maximum amount of wages subject to the 6.2 percent Social Security payroll tax will be $184,500, up from $176,100 in 2025.
This cap matters because Social Security tax stops once an employee’s year to date wages hit the wage base. Medicare tax does not stop, since the 1.45 percent Medicare payroll tax applies to all wages with no limit.
The Social Security Administration’s annual update means both the employer and the employee can pay Social Security tax on up to $8,400 more wages in 2026. At 6.2 percent, that is up to about $520 more on the employer side per affected worker, and about $520 more withheld from the employee, for roughly $1,040 combined.
If you have anyone earning near the cap, or you pay yourself a salary through an S corp, update your payroll software before the first 2026 payroll run. If the cap is not updated, your Form 941 deposits can be off, which increases the risk of underpayment issues and penalties.
For budgeting, the cleanest way to estimate impact is to flag employees projected to cross $176,100 in 2025 and $184,500 in 2026 and then model the difference in employer Social Security tax. This is also a good moment to confirm that your payroll provider is handling Medicare correctly above the wage base, since Medicare continues on all wages.
Self employed founders should also plan for a higher Social Security portion of self employment tax if net earnings are above the new threshold. The IRS generally allows you to deduct half of self employment tax as an adjustment to income, which helps, but it does not eliminate the cash impact.
The wage base figure comes from the Social Security Administration’s published 2026 amounts and is widely reported in payroll and tax coverage, including Thomson Reuters coverage of the SSA announcement and the SSA’s COLA and benefit changes page.
