What is the main difference between Social Security tax and Medicare tax?

The main difference between Social Security tax and Medicare tax lies in the specific benefits each tax is designed to fund. Social Security tax primarily funds retirement benefits that provide financial support to individuals once they reach retirement age. It also supports disability benefits and survivors' benefits, ensuring that dependents of deceased workers have financial assistance.

On the other hand, the Medicare tax is dedicated specifically to funding health insurance for individuals aged 65 and older, as well as for some younger people with disabilities. Medicare provides vital healthcare coverage, including hospital visits and outpatient services, aimed at ensuring that seniors and qualifying individuals have access to necessary medical care.

This distinction is crucial because it highlights how each tax serves different needs within the social safety net. Social Security is focused on providing income stability in retirement or in the event of disability or death, while Medicare addresses health coverage to safeguard the well-being of older adults and certain disabled individuals.