The maximum amount of taxable earnings for Social Security will increase to $176,100 starting in 2025, according to the IRS. This change is part of adjustments made to reflect national wage trends.
Currently, workers pay a 12.4% tax on their earnings, which is split between workers and employers. The tax rate has remained the same since 1990, but the maximum amount of taxable income has increased over the years. In 2025, the threshold will be raised from $168,600 to $176,100.
For workers with multiple jobs, their employers must withhold Social Security taxes from wages. If this exceeds the new limit, workers can claim a refund when filing tax returns.
Note: The increase in the taxable income limit is not related to changes in Social Security benefits or increases in 2025.
Source: https://en.as.com/latest_news/goodbye-to-the-168600-tax-income-limit-in-2025-the-updated-maximum-amount-of-taxable-earnings-for-social-security-n-2