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I know that the wage base limit for 2020 is $137,700, but that is for one person. Is there a different limit for married couples filing jointly (e.g. double the $137,700 = $265,400, or something else), or is that still computed on an individual basis?

Essentially what I'm asking is if I make $200,000 and my wife makes $50,000, would we pay social security taxes on $250,000 (because our combined income is less than $265,400) $187,700 (because my taxable income is capped at $137,700 and all of hers is taxable), or something else (because there's a different wage base limit for the two of us combined)?

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The wage base limit is an individual limit.

If you hit the limit, your employer will stop withholding 6.2% for Social security from your check; but if your spouse hasn't hit their limit their employer will still withhold 6.2% from their paycheck until they hit their limit.

If this wasn't the case, think how hard it would be for the two employers to know the combined family income to know when a combined limit was reached. The employers would have to know what the family year-to-date number was, and update the other employer after each paycheck.

If a person has more than one job, or they switch companies partway though the year, they can exceed the limit without their employer knowing. In that case the taxpayer gets a refund when they file their taxes in the spring.

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  • "If this wasn't the case, think how hard it would be for the two employers to know the combined family income to know when a combined limit was reached." But like the case with one person with two jobs, the employer don't need to know and you can get the refund when you file taxes, if the law indeed provided for a joint limit. The pertinent thing is that the law provides for an individual limit only. – user102008 Feb 15 '20 at 18:05
  • Thanks. But re: your 2nd paragraph, I don't see how that's any different than any other disparity in what was withheld vs. what I actually owe. For example, if I make $20,000 per year and my wife makes $10,000,000, I will get virtually nothing (in terms of federal/state tax) withheld from my paychecks while I will end up owing a very high percentage (if we file jointly). And it all works out when we file our return. – Jer Feb 16 '20 at 4:16
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Meta: not really an answer because not asked, but too much for a comment

First, I concur with mhoran_prep that Social Security tax is determined separately for each individual even when filing joint. Also for regular Medicare tax, which does not stop at the 'wage base'.

But for the Additional Medicare Tax recently added by PPACA, joint filing does matter. If Jer's case were actually self=$210k wife=$40k, then the employer would be required to withhold 0.9% on the $10k over $200k for Jer, even though on the joint return Jer&wife will be within the $250k threshold and actually owe no tax, so all else equal the withholding will become a refundable overpayment.

See https://www.irs.gov/taxtopics/tc560

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