Tax
Social Security wage base
The annual cap on earnings subject to Social Security tax, above which only Medicare tax applies.
Social Security tax stops once your earnings for the year reach the base. Medicare has no cap, and an additional Medicare tax applies above a further threshold.
The base rises most years with average wages.
Wages and self-employment income share one base. If a job has already used it up, the Social Security portion of self-employment tax on a side business can be zero while the Medicare portion still applies.
In Contha
Contha fills the base with wages first, which is what makes the estimate for somebody with a job and a business different from a freelancer’s.
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