OASDI

What does OASDI stand for?

OASDI stands for Old-Age, Survivors, and Disability Insurance. It is the official name of the US Social Security program, which provides retirement, disability, and survivor benefits to eligible workers and their dependents.

What is OASDI?

OASDI is part of the broader US Social Security system and is funded through payroll taxes collected under the Federal Insurance Contributions Act (FICA). Both employees and employers are required to contribute.

As of 2025, the OASDI tax rate is 6.2% for employees and 6.2% for employers, applied to wages up to the Social Security wage base limit (which is indexed annually).

The program supports a wide range of benefits, including:

• Old-age benefits for retirees who have accumulated sufficient work credits
• Survivors benefits for the spouses and children of deceased workers
• Disability benefits for workers with qualifying long-term disabilities
  
  

Why does it matter?

If you employ people in the US, you must correctly calculate, withhold, and match your employees’ OASDI contributions as part of your regular payroll process. Failing to do so can result in financial penalties and legal exposure.

As the employer, you are also responsible for timely remittance of these taxes to the Internal Revenue Service (IRS), and must accurately report them on your quarterly and annual payroll tax filings.

For remote-first or globally distributed companies, it's important to recognise that US tax obligations like OASDI only apply to employees working in the US (or classified as US employees). As a result, you should be aware of these obligations when expanding into (or hiring from) the US labour market.

How does Remote help?

When hiring US-based employees through Remote, OASDI contributions are automatically managed. Remote ensures accurate withholding, employer matching, and remittance, as well as compliant reporting — removing the administrative burden from international employers. Learn more.