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What Is the Federal Insurance Contributions Act (FICA)?

By Motley Fool Staff – Updated Jun 8, 2025 at 5:37AM

Key Points

  • FICA taxes fund Social Security and Medicare, critical for retirees and Medicare recipients.
  • Employees and employers each pay a 7.65% FICA rate; self-employed pay 15.3%.
  • FICA's future challenges include potential deficits starting 2035, prompting reform debate.
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