How is Medicare supplemental tax calculated?
Based on the Additional Medicare Tax law, all income for an individual above $200,000 is subject to an additional 0.9% tax. Therefore, his Additional Medicare Tax bill is $50,722 X 0.9% = $456. He has already paid (1.45% X $199,558) + (2.9% X $51,164) = $2,893.59 + $1,483.7 = $4,377.29 in Medicare taxes already.
When did the additional Medicare tax begin?
Additional Medicare Tax went into effect in 2013 and applies to wages, compensation, and self-employment income above a threshold amount received in taxable years beginning after Dec. 31, 2012.
What is supplemental Medicare tax?
The Additional Medicare Tax is an extra 0.9 percent tax on top of the standard tax payment for Medicare. The additional tax has been in place since 2013 as a part of the Affordable Care Act and applies to taxpayers who earn over a set income threshold.
What is the threshold for additional Medicare tax?
A 0.9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation that exceed the following threshold amounts based on filing status: $250,000 for married filing jointly; $125,000 for married filing separately; and. $200,000 for all other taxpayers.
Why did my Medicare taxes go up?
There’s no need to pay Social Security taxes on the income you earn over $137,700. The limit is the Social Security wage base. If your income is above $200,000 ($250,000 for married couples filing together), your Medicare tax rate will rise to 2.35%.
What is my supplemental tax rate?
Optional Supplemental Flat tax rate is 22% for Federal & 6.6% for the State of California. Bonus flat tax rate is 22% for Federal & 10.23% for the State of California.
What is the rate for the additional Medicare tax?
What is the Additional Medicare Tax? 1 Tax Rate. The Additional Medicare Tax rate is 0.9 percent. 2 Income Subject to Tax. The tax applies to the amount of wages, self-employment income and railroad retirement (RRTA) compensation that is more than a threshold amount. 3 Withholding / Estimated Tax. 4 Underpayment of Estimated Tax.
Are there any tax deductions for Medicare supplement?
Yes, they are deductible, along with other medical expenses, if you meet certain criteria. Yes, premiums for Medicare supplement plans are deductible if they exceed a certain threshold. Learn more.
What was the exemption for income tax for 2015?
• The Alternative Minimum Tax exemption amount for tax year 2015 is $53,600 ($83,400, for married couples filing jointly). The 2014 exemption amount was $52,800 ($82,100 for married couples filing jointly).
What’s the maximum taxable income for Social Security in 2015?
Based on the increase in average wages, the maximum amount of earnings subject to the Social Security tax (the “taxable maximum”) will increase to $118,500 from $117,000 for 2015, the Social Security Administration (SSA) announced on Oct. 22.