Social Security tax does not apply to every dollar you earn. It stops at a yearly limit called the taxable maximum. In 2027, that limit goes up to $192,300, from $184,500 in 2026.
Most teachers and public workers earn less than that, so the change will not touch their paychecks. But the limit still matters, because it also caps how much of your pay counts toward your Social Security benefit. Here is how it all works.
How Social Security tax works
If your job pays into Social Security, two taxes come out of each paycheck:
| Tax | You pay | Your employer pays | Limit |
|---|---|---|---|
| Social Security | 6.2% | 6.2% | First $192,300 in 2027 |
| Medicare | 1.45% | 1.45% | No limit |
Once your pay for the year passes the limit, the Social Security tax stops for the rest of the year. The Medicare tax keeps going on every dollar. People who earn over $200,000 ($250,000 for married couples) also pay an extra 0.9% Medicare tax.
The most anyone can pay in Social Security tax in 2027 is $11,922.60. Your employer pays the same amount.
If you are self-employed, you pay both halves yourself: 12.4% for Social Security up to the limit, plus 2.9% for Medicare.
How the limit has grown
The limit rises each year with average wages across the country.
| Year | Taxable maximum |
|---|---|
| 2023 | $160,200 |
| 2024 | $168,600 |
| 2025 | $176,100 |
| 2026 | $184,500 |
| 2027 | $192,300 |
Does this affect teachers?
For most, no. The average teacher salary is far below the limit. Even top-paid teachers rarely reach it.
It can matter for:
- Superintendents and senior administrators
- Doctors, lawyers and others in high-paying public jobs
- People with high pay from a side business
If your public job does not pay into Social Security at all, you only pay the Medicare tax there, and this limit does not apply to that job.
If you have two jobs
Each employer takes out Social Security tax on its own, without knowing about the other job. If your combined pay from two or more employers goes over the limit, you may pay too much.
You get the extra back when you file your taxes. It is claimed as “excess Social Security tax withheld” on your federal return. This only works across different employers. If one employer takes out too much, you need to ask that employer to fix it.
Why the limit matters for your benefit
Social Security only counts pay up to the limit when it figures your benefit. Pay above the limit is not taxed, and it also does not raise your check.
This is why the highest possible Social Security benefit is capped. In 2027, the largest check for someone who retires at full retirement age is $4,188 a month. To get it, you need to have earned at or above the limit for 35 years.
How this fits with a pension
Many public workers have a pension from a non-covered job and Social Security from other work. For them, the limit rarely comes into play, because their covered earnings come from part-time or earlier jobs.
What matters more is having enough covered work to qualify at all. You need 40 credits, and in 2027 each credit takes $1,970 of covered pay. Read you need $1,970 for a Social Security credit in 2027, or count yours with the 40-credit checker.
Questions people ask
Does the limit apply to my pension income? No. Social Security tax only applies to pay from work. Pensions, Social Security benefits and investment income are not taxed this way.
Do I keep paying Social Security tax after I retire if I work? Yes. If you work in a covered job, the tax comes out of your pay at any age. Those earnings can also raise your benefit if they are among your best 35 years.
Is the 6.2% rate going up? Not in 2027. The rate is set by law and has been 6.2% for employees since 1990.
Our pension and Social Security calculator uses the 2027 limit.