What the number means
In 2024 the OASDI tax took 6.2% of the first $168,600 of wages. Above that threshold the withholding stopped for the rest of the calendar year, and the employee kept the full marginal dollar minus Medicare, which continued at 1.45% with no ceiling. Employer and employee each paid $10,453.20 at the cap, for $20,906.40 in total contributions per high earner.
The same ceiling limited credited earnings. A 2024 salary of $250,000 produced $168,600 of Social Security earnings on the record, which is the figure that feeds an eventual benefit computation.
2023 and 2024 side by side
| Item | 2023 | 2024 | Change |
|---|---|---|---|
| Wage base | $160,200 | $168,600 | +$8,400 (+5.2%) |
| Maximum employee tax | $9,932.40 | $10,453.20 | +$520.80 |
| Maximum employer tax | $9,932.40 | $10,453.20 | +$520.80 |
| Maximum self-employed tax | $19,864.80 | $20,906.40 | +$1,041.60 |
Where the 5.2% came from
The 2024 base used the 2022 average wage index. Wages grew faster than prices that year, but far more slowly than in 2021, so the increase reverted from 9.0% to 5.2%. The statutory formula is mechanical: $60,600 multiplied by the index ratio, then rounded to the nearest $300. No vote, no discretionary adjustment, no phase-in.
Because the round-to-$300 step can absorb or add up to $150, the percentage change in the base never matches the underlying wage growth exactly. That is why published year-over-year figures sometimes look off by a tenth of a point against the wage data.
Who felt it
Only earners above $160,200 saw any change, and only on the band between the two ceilings. At $250,000 the extra cost was $520.80 for the year, or roughly $43 a month. At $168,600 exactly, total employee OASDI withholding for 2024 was $10,453.20.
Two mechanical points cause most payroll disputes. First, the cap resets on January 1 regardless of how much was withheld in December, so an employee who reached the 2023 cap in October started over in 2024. Second, a mid-year job change can restart withholding at the new employer, producing apparent over-withholding that is only reconciled on the individual return.
Supplemental pay follows the same rule as salary. Bonuses, commissions and vested stock are FICA wages when paid, so a large first-quarter grant can push someone through the $168,600 ceiling by June and leave only Medicare withholding on the remaining stubs. Employers do not smooth this across the year; the cap applies to cumulative wages as actually paid, which is why two employees with identical salaries can reach it in different months.
That timing matters for cash-flow planning. A high earner whose pay is bonus-weighted sees the OASDI line disappear early and reappear in January at the new ceiling. Someone on a flat salary approaches the threshold gradually and crosses it in the fourth quarter. Both paid the same annual maximum in 2024 if both finished above $168,600.