The employer FICA rates are 6.2% for social security and 1.45% for Medicare, and both belong on the labor burden sheet. According to Internal Revenue Service, "The social security tax rate is 6.2% each for the employee and employer." The employer side of that sentence is the 6.2% figure you add to labor burden.
The Medicare figure is the second rate. According to Internal Revenue Service, "The Medicare tax rate is 1.45% each for the employee and employer, unchanged from 2025." Those two rates are federal payroll rates, so they do not make up the whole employer burden.
Key takeaways
- treat 6.2% and 1.45% as federal payroll rates, not the full employer burden.
- check that the $3,000 household worker threshold stays off crew wage lines.
- keep the COVID-era sick and family leave credit out of a current bid burden.
- where an Ohio force account project assessment form is required, keep the burden line beside subcontracted and competitively bid costs.
- check February 2, 2026 against prior filings, since it was the deadline for W-2 copies to the SSA and employees.
Where the FICA rates sit in labor burden
Treat the employer FICA rates as one part of the labor rate, not as the whole rate. The federal price adjustment clause limits adjustments in one sentence that names fringe benefits. According to Acquisition.gov, "(1) Any adjustment shall be limited to the effect on unit prices of the increases or decreases in the rates of pay for labor (including fringe benefits) or unit prices for material shown in the Schedule." Keep fringe benefits in view whenever you read a labor rate on the bid.
Write fringe benefits on their own line beside the pay rate, so the labor rate you carry into the bid shows both parts. Keep the employer FICA lines on the same sheet in a separate block. Check the pay rate and the fringe figure together before the labor rate locks. This sheet layout is an editorial recommendation. Review that pair again whenever the crew wage changes.
Ohio code sets a rule for force account estimates. According to Ohio Laws, "When a force account project assessment form is required, the estimate shall include costs for subcontracted work and any competitively bid component costs." Read that rule as Ohio law only.
If your bid is an Ohio force account job, place the burden line beside the subcontracted and competitively bid costs that the code names. Keep the employer FICA rates out of those cost lines. Where the Ohio rule does not apply, keep the same separation as a working habit, and label the basis of each line so the estimate shows where each cost comes from.
Read employer tax figures to copy before you lock the hour as a companion to this article. Use it to check which employer lines sit beside the two federal rates on your sheet. Keep the federal rates labeled as federal, so they are not mistaken for the full set. Then enter both rates on separate lines, as the sections below explain.
Social security at 6.2 percent
The 6.2% rate is stated for both sides of the payroll, and the employer side is the number you need for the burden line.
Enter the employer share as its own line, labeled as social security with the 6.2% figure beside it. Keep the employee share out of that line, so the two figures are not added together. Write the crew wage figure beside the rate, so the line shows what it was calculated on. Use the same label on every bid that uses this rate.
Multiply the rate by the crew wages your bid uses, and keep that wage figure on the same row as the result. If your bid uses several crew rates, calculate each one separately rather than averaging them first. Add the rows together after each one is complete. Totals belong below the rows, not inside them.
Write the source and the 2026 year beside the rate, using the publisher name and the page you checked. Keep the link to that page in your bid notes, so the figure can be checked again. Recheck the rate before each bid that uses it, since the rate comes from a form instruction.
For more employer payroll tax rows to check beside this figure, read employer payroll tax rules in sourced rows before you finalize the labor line. That page is a companion for the rows, while this section covers the social security rate. Compare each row on that page with the rate you entered here.
Medicare at 1.45 percent
The 1.45% figure is stated for each side, so the employer side is the number you carry. The rate follows the same pattern as the social security figure in the section above.
The phrase unchanged from 2025 is part of the source sentence, so it describes the comparison and not a new figure. If an older sheet still shows a 2025 label, update the label and keep the rate. Check the label once more before the bid goes out.
Enter 1.45% as its own line beside the 6.2% social security line, so the two federal rates stay separate on the sheet. Label each with its source and year. Do not merge them into one rate. A single merged line would hide which source produced which figure.
Copy the full sentence when you note the rate, so the employee and employer sides both appear in your notes. Keep that note with the bid file for later review.
Before the bid locks, check the 1.45% figure against the current form instructions and write the date you checked it beside the line. Use the same check for the 6.2% figure, so both federal rates are reviewed together. If either figure has changed by the time you review it, use the newer source and note the change.
Thresholds that do not apply to crews
According to Internal Revenue Service, "Social security and Medicare taxes apply to the wages of household workers you pay $3,000 or more in cash wages in 2026." The threshold is stated for household workers, so the figure does not describe crew payroll.
Do not carry the $3,000 figure onto crew wage lines, even when crew pay looks similar in size. Keep crew wage lines calculated from crew wage rates, not from a household figure.
Check each crew wage line on its own terms, starting with the wage rate your bid uses. Write a note next to any line that is a household worker, so the household threshold stays tied to those rows. Treat the household threshold as a separate row on your sheet, if your bid includes household workers at all.
Ask whether each wage line is a crew wage, a household wage, or neither, and write the answer in the note. Match each line to the rule its own source names before you total the labor. Recheck that answer whenever a worker moves between crew and household payroll.
Choose the crew wage figure from your own bid records, then write its source beside the line. Use a plain label such as crew wage or household worker, so no reader mixes the two. Keep the crew wage figure separate from any household figure in your notes, and confirm both labels before the bid goes out.
Credits you cannot carry forward
According to Internal Revenue Service, "The COVID-19 related credit for qualified sick and family leave wages is limited to leave taken after March 31, 2020, and before October 1, 2021, and may no longer be claimed on Form 941." That sentence is the basis for leaving the credit out of current bids. It names both a date window and a form.
The window in that sentence runs from after March 31, 2020 to before October 1, 2021, so it does not describe leave in a current bid. Do not net the credit into the burden percentage, because the leave window closed on October 1, 2021. The credit belongs to that earlier time, not to the current burden.
Remove any leftover credit line from an older sheet before you reuse it on a new bid. Check the labor burden total after that line is removed, so the total reflects the lines you still use. Write the removal in your notes, with the date of the change.
Record the date window in your notes if an older bid still shows the credit. Mark that line as one that may no longer be claimed. Keep the correction with the older file so the change is visible.
Read construction unemployment tax figures for bid estimates to keep unemployment tax separate from the federal FICA rates. Give unemployment tax its own row, so the federal FICA rates on this page are not mistaken for it. Check that row against its own source before you total the burden. Keep that check separate from the FICA check you completed earlier in this article.
Working out your own burden line
Start with the two federal rates as fixed inputs. According to Internal Revenue Service, the employer side of social security is 6.2% and the Medicare employer side is 1.45%. Carry both into the burden sheet as entries that stay visible during review. Do not round either figure, so each entry matches its source exactly.
Build the labor burden in steps: first the federal FICA rates, then any other employer lines you track, each on its own row. Write the total after every row is entered. Keep the step order the same on each bid, so sheets can be compared side by side. A repeated order also makes a missing row easier to spot.
Write the wage base beside each rate, and check that the base uses crew wages rather than household worker figures. Mark any household worker row so it is easy to review. If the base is blank, leave the rate row unfinished rather than filling it with a guess. Review that mark before the bid is issued.
Keep the COVID-era credit out of current bids, and keep Ohio force account cost lines beside the burden line when that rule applies. According to Internal Revenue Service, Copy A and the employee copies were due by February 2, 2026, so check that date against prior filings. Recheck each burden row before the labor rate locks.
Next step: Enter 6.2% and 1.45% as two separate employer lines in your labor burden sheet, each labeled with the source and the 2026 year. Cite the same Internal Revenue Service page for both figures, so a reviewer can check both lines against one source. Place these rows above the crew wage rows, so the rates are reviewed first. Then confirm that no household threshold or COVID-era credit sits in the same block.
Related guides: Construction overtime cost: 5 inputs for a bid rate · Construction wage selection: 3 checks for a bid rate.
FAQ
What is the employer social security rate?
The employer rate is 6.2%, matched by 6.2% for the employee. According to Internal Revenue Service, the rate applies to each side of the payroll. Do not add the employee share to the employer line. Enter the employer figure as its own line in the labor burden.
What is the employer Medicare rate?
The employer rate is 1.45%, matched by 1.45% for the employee, unchanged from 2025. Use the same Internal Revenue Service page as for the social security rate, and keep it on its own line beside that rate.
Does the $3,000 threshold apply to crew wages?
According to Internal Revenue Service, the $3,000 cash-wage threshold is stated for household workers, so crew wage lines are not covered by it. Keep the threshold off crew wage lines, and give household worker wages their own labeled rows if your bid includes them.
What date applies to Form W-2 copies?
According to Internal Revenue Service, "You must submit by mail or electronically Copy A of Form(s) W-2 to the SSA with the transmittal Form W-3 by February 2, 2026." The same page states that "You must furnish Copies B, C, and 2 of Form W-2 to your employees by February 2, 2026." Both dates have already passed, so check prior filings against them and document the copies you sent.
Can the COVID-era credit go into a current bid burden?
No, the credit should not go into a current bid burden. According to Internal Revenue Service, the window for the credit runs from after March 31, 2020 to before October 1, 2021. Do not net the credit into current burden, and keep any older bid that still shows it as a file to correct.
Why do Form W-2 records matter for the labor burden?
According to Internal Revenue Service, "Because employees' Social Security and Medicare benefits are computed based on information on Form W-2, it's very important to prepare Form W-2 correctly and timely." Keep the payroll records behind each W-2 accurate, because those benefits are computed from Form W-2 information. Check the payroll entries that feed each W-2 before the bid uses those wage figures. Use accurate W-2 figures when you set the crew wage line.