Starting Jan. 1, 2019, the maximum earnings that will be subject to the Social Security payroll tax will increase to $132,900. Before the start of the new year, it's essential to understand how changes to the Additional Medicare Tax may impact your finances.
Social Security is currently financed by a 12.4 percent tax on earnings, up to the cap (which is projected to be $170,400 next year). However, there is an additional Medicare tax that high-income earners must pay. This tax is known as the Additional Medicare Tax.
An employer will issue a Form W-2 to you if you are an employee. Here's a look at what you need to know about your Form W-2 for the current tax year, including information on the Additional Medicare Tax.
Overpayments and repayments are two of the most common anomalies that complicate year-end and W-2 processing. Make sure you understand IRS regulations regarding the Additional Medicare Tax to avoid any discrepancies.
Medicare is a vastly popular and relied upon program in the U.S. According to the Center for Medicare Advocacy, 65,103,807 people were enrolled in Medicare in 2020. Understanding the Additional Medicare Tax is crucial for individuals who earn over a certain threshold.
What Is the Additional Medicare Tax? The Additional Medicare Tax has been in effect since 2013. Taxpayers who make over $200,000 as single filers or $250,000 for married couples filing jointly are subject to this tax.
The Medicare surcharge known as IRMAA can be a tough pill to swallow for high-income earners. However, there is a little-known workaround: Older Americans who have been impacted by IRMAA may be eligible for relief.
FICA is the federal income tax that funds Social Security and Medicare. Here's how to properly calculate and pay these taxes, including the Additional Medicare Tax for high-income earners.
Taxes can feel intimidating, so we've compiled easy-to-understand information on your Form W-2 and other special tax forms. Understanding the Additional Medicare Tax is crucial for accurate tax filings.
