The Federal Insurance Contributions Act, (FICA), is another term for Social Security. This particular type of tax is withheld from employee paychecks. The funds from this tax go into a government trust fund. The funds are then used to fund Social Security benefits, which includes payments to retired individuals after their retirement age as well as medical care services, disability services and survivor services. This tax is paid at the time of payroll. Both the employer and the employee share in the cost of the Federal Insurance Contributions Act payments, on an equal basis. The tax has a basis on the employee's earned wages. The tax rate changes per year, and is specific to covered wages only. Paying this type of tax is not an option for the tax payer.