Most California public school teachers do not pay into Social Security. Instead, they contribute to the California State Teachers’ Retirement System (CalSTRS), a state pension that functions as a complete substitute for the federal program. Teachers pay roughly 10.2% to 10.25% of their salary into CalSTRS rather than the 6.2% Social Security (OASDI) tax that private-sector workers pay. There are exceptions, and Medicare tax is a separate matter that still applies to nearly everyone.
Why CalSTRS Replaces Social Security
California’s Education Code establishes CalSTRS under Part 13 of Title 1, creating a Defined Benefit pension that provides retirement, disability, and survivor benefits paralleling what Social Security offers.1Justia. California Code Education Code Part 13 – State Teachers Retirement System Because the state program covers the same ground, the federal government does not require these teachers to also pay the 6.2% OASDI tax.
What you contribute depends on when you were hired. Teachers in the original “2% at 60” structure (hired before January 1, 2013) pay 10.25% of their creditable earnings. Teachers hired on or after that date fall under the California Public Employees’ Pension Reform Act, known as “2% at 62” or PEPRA members, and pay 10.205%.2CalSTRS. 2025-26 Annual Budget Report The deduction comes out of every paycheck automatically.
When California Teachers Do Pay Social Security
Not every California teacher is exempt. Some school districts have entered into Section 218 Agreements with the Social Security Administration, voluntary arrangements that extend federal Social Security and Medicare coverage to state and local government employees.3Social Security Administration. Section 218 Agreements – State and Local Government Employers Teachers working for those districts pay into both CalSTRS and Social Security at the same time, building credits in each system.
These agreements are authorized by Section 218 of the Social Security Act.4Social Security Administration. Social Security Act Section 218 – Voluntary Agreements for Coverage of State and Local Employees Once a district opts in, the choice is permanent. The district cannot later remove its employees from Social Security coverage.3Social Security Administration. Section 218 Agreements – State and Local Government Employers
Employment classification matters too. Part-time, substitute, and temporary teachers who do not meet the minimum service thresholds for CalSTRS membership may be placed into Social Security or an alternative retirement plan instead. The specific rules depend on district policy and any applicable collective bargaining agreement.
How to Check Your Own Coverage
Look at your pay stub for an OASDI deduction line. If it shows zero or is missing, you are almost certainly covered only by CalSTRS. If you want to confirm the district’s Section 218 status directly, the SSA points people to their state’s designated Social Security Administrator, the official responsible for California’s Section 218 Agreement.3Social Security Administration. Section 218 Agreements – State and Local Government Employers Your district’s HR or payroll office can also tell you which programs apply to your position.
Medicare Tax Still Applies
Even though most California teachers skip the 6.2% Social Security tax, they still pay the 1.45% Medicare Hospital Insurance tax if they were hired after March 31, 1986. Federal law extended mandatory Medicare coverage to all state and local government employees hired after that date, regardless of Social Security status.5eCFR. 42 CFR 406.15 – Special Provisions Applicable to Medicare Qualified Government Employment
Your employer matches the deduction, so the total Medicare contribution from each paycheck runs 2.9%. Teachers hired by their current district before April 1, 1986, with continuous service since, may be exempt, but that applies to very few educators still working.
The Medicare Part A Problem for Career Teachers
Because most California teachers pay only the Medicare portion of FICA, their record may not be enough to qualify for premium-free Medicare Part A at age 65. Premium-free Part A requires 40 quarters of coverage, roughly 10 years of work where FICA taxes were paid.6Centers for Medicare & Medicaid Services. Original Medicare (Part A and B) Eligibility and Enrollment A teacher who spent an entire career in CalSTRS-covered work without another job that paid full FICA may fall short.
You can still enroll in Part A by paying a monthly premium. In 2026, the full Part A premium is $565 per month for individuals with fewer than 30 quarters of coverage. Those with 30 to 39 quarters pay a reduced premium of $311 per month.7Centers for Medicare & Medicaid Services. 2026 Medicare Parts A and B Premiums and Deductibles You must also be enrolled in Medicare Part B to buy into Part A.
Part B carries its own late-enrollment risk. If you delay signing up past your initial eligibility window without qualifying for a Special Enrollment Period, your Part B premium increases by 10% for each full 12-month period you were eligible but not enrolled, and the surcharge lasts as long as you have Part B.8Medicare.gov. Avoid Late Enrollment Penalties Career teachers without a strong FICA history from other jobs should plan for these costs well before 65.
The Social Security Fairness Act Changed What Teachers Can Collect
For decades, two federal rules reduced the Social Security benefits of people who received pensions from jobs where they had not paid Social Security tax. The Windfall Elimination Provision (WEP) shrank retirement benefits earned through a second career. The Government Pension Offset (GPO) reduced or wiped out spousal and survivor benefits. Both rules hit California public school teachers hard.
The Social Security Fairness Act, signed into law on January 5, 2025, permanently repealed both. The repeal is retroactive to January 2024, so neither provision has applied to any benefits payable since that date.9Social Security Administration. Social Security Fairness Act – Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) Update Practically, that means:
- If you earned enough credits from non-teaching work to qualify for Social Security, your monthly payment is no longer trimmed by the WEP formula. You get the full amount your earnings record produces.
- If your spouse paid into Social Security, any spousal or survivor benefit you qualify for is no longer reduced by two-thirds of your CalSTRS pension. Many teachers whose spousal benefit had been cut to zero now receive the full amount.
- The SSA has already processed over 3.1 million payments totaling $17 billion to affected beneficiaries, covering increases owed back to January 2024.9Social Security Administration. Social Security Fairness Act – Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) Update
- If you previously did not apply for Social Security because WEP or GPO would have erased it, you can apply now. Retroactive benefits for retirement and spousal claims are generally limited to six months before the month you file.
If You Leave Teaching Before You Vest
Because CalSTRS contributions do not build Social Security credits, leaving the profession early raises a specific question: what happens to the money you put in? You have two choices. You can request a refund of your personal contributions to the Defined Benefit account, though employer and state contributions stay in the fund. Employer contributions credited to your Defined Benefit Supplement account are refundable.10CalSTRS. Refund of Contributions
Alternatively, if you have at least five years of service credit, you can leave your contributions in the system and claim a deferred retirement benefit when you reach the minimum retirement age.11CalSTRS. Retirement Benefits Taking the refund forfeits all service credit you had built. If you later return to CalSTRS-covered work, you start over unless you redeposit what you withdrew. That trade-off matters most for teachers close to the five-year vesting line.