Federal Insurance Contributions Act (FICA) definition including break down of areas in the definition. Analyzing the definition of key term often provides more insight about concepts. Federal Insurance Contributions Act (FICA)can be defined as: Taxes assessed on both employers and employees; Sucial Security and Medicare programs. Federal Insurance Contibutionis Act (FICA) covers both Medicare and Social Security. FICA taxes are payroll taxes employees paying half the FICA tax and employers paying the other half of the FICA tax.
