SSA Bumps Up Social Security Taxable Wage Base For 2027

Time to update your systems: The Social Security Administration (SSA) has announced the 2027 Social Security taxable wage base. Next year’s number will increase to $192,300; that’s $7,800 more than the current $184,500.

So, the intermediate projection in the 2026 Social Security Trustees Report ($190,200) was $2,100 low.

Congress set the Social Security tax at 6.2% for employees and employers, and it will remain that way. That means if an employee earns $192,300 (or more) next year, you’ll withhold $11,922.60 – $483.60 more than this year’s maximum of $11,439. Your company will pay a matching $11,922.60 as the employer share.

The 1.45% Medicare portion of FICA is unchanged, as is the 0.9% Additional Medicare Tax (AMT). Withhold the AMT on wages you pay an employee above $200,000 in the year, regardless of filing status. The $250,000 threshold for married couples filing jointly applies when they file their tax returns.

Working and Receiving Social Security

Do you have employees on the payroll who have already begun to receive Social Security retirement benefits? If so, workers who haven’t reached full retirement age may prefer to keep their earnings under the annual limit set by SSA, as exceeding that limit will cause the agency to withhold some of their retirement benefits.

SSA released numbers related to that for 2027:

• For an employee who won’t yet reach full retirement age in 2027, the limit will be $25,560, up from $24,480. For every $2 earned above the limit, SSA will withhold $1 from their benefit payments.
• For an individual who will reach full retirement age in 2027, the limit will be $67,920, up from $65,160, for earnings before the month they attain full retirement age. For every $3 earned above that limit, SSA will withhold $1 in benefits.

Be aware that when determining how much someone has earned for these purposes, SSA includes bonuses, commissions and vacation pay.

Also remind employees that once they reach full retirement age, the annual earnings limit no longer applies.

As for retirement benefits, SSA also announced a 3.6% cost-of-living adjustment (COLA) for 2027. The 2026 COLA was 2.8%.

More info: 2027 Cost-of-Living Adjustment (COLA) Fact Sheet