Data Source and Methodology
Primary references:
- IRS Topic No. 751 — Social Security and Medicare Withholding Rates (latest). IRS.gov — https://www.irs.gov/taxtopics/tc751
- IRS — Questions and Answers for the Additional Medicare Tax. IRS.gov — Q&A Additional Medicare Tax
- IRS — Self-Employment Tax (Social Security and Medicare Taxes). IRS.gov — Self-Employment Tax
Tutti i calcoli si basano rigorosamente sulle formule e sui dati forniti da questa fonte.
The Formula Explained
Employer Medicare on wages:
Self‑employment (SE) Medicare estimate:
Additional Medicare Tax (AMT) liability by filing status:
Employer AMT withholding rule (independent of status):
Estimated AMT balance at filing:
Total employee‑side Medicare (annual, estimate):
Glossary of Variables and Fields
| Symbol/Field | Meaning |
|---|---|
| Medicare wages (W‑2 Box 5) — W | Taxable wages for Medicare purposes; may differ from W‑2 Box 1. |
| Net self‑employment income — S | Net profit from self‑employment. For Medicare, the base is estimated as 92.35% of S. |
| Filing status | Determines the threshold for the 0.9% Additional Medicare Tax when calculating individual liability. |
| Base employee Medicare — M_e | 1.45% of W, no wage cap. |
| Employer Medicare — M_er | 1.45% of W paid by employer; there is no employer match of the 0.9% additional. |
| Self‑employment Medicare — M_se | Estimated 2.9% of 92.35% of S. |
| Additional Medicare Tax liability — A_ℓ | 0.9% of the amount by which (W + 92.35% of S) exceeds the filing‑status threshold. |
| Employer AMT withholding — A_w | 0.9% of wages over $200,000 per employee, regardless of filing status. |
| Estimated AMT balance | A_ℓ − A_w (positive = amount potentially owed; negative = potential refund). |
Worked Example
How It Works: A Step‑By‑Step Example
Scenario: Single filer, Medicare wages W = $300,000, no self‑employment income (S = $0).
- Base employee Medicare: M_e = 1.45% × 300,000 = $4,350.
- Filing status threshold T for Single: $200,000.
- Combined base B = W + 0.9235 × S = 300,000 + 0 = 300,000.
- Additional Medicare liability: A_ℓ = 0.9% × max(0, 300,000 − 200,000) = 0.009 × 100,000 = $900.
- Employer AMT withholding: A_w = 0.9% × max(0, 300,000 − 200,000) = $900.
- Estimated AMT balance: A_balance = A_ℓ − A_w = $0 (no balance due).
- Total employee‑side Medicare: M_total = $4,350 + $900 = $5,250.
Frequently Asked Questions (FAQ)
Is there a wage cap for Medicare tax?
No. Unlike Social Security, Medicare has no wage base limit. The 1.45% employee rate applies to all Medicare wages, and high earners may owe an additional 0.9%.
What are the Additional Medicare Tax thresholds by filing status?
Single/Head of Household/Qualifying Widow(er): $200,000; Married Filing Jointly: $250,000; Married Filing Separately: $125,000.
Why did my employer withhold the additional 0.9% when we file MFJ under $250,000?
Employers must withhold on an employee’s wages over $200,000, regardless of your filing status or spouse’s income. Any over‑withholding is reconciled on your tax return.
Do 401(k) contributions reduce Medicare wages?
Generally no. 401(k) elective deferrals remain subject to Medicare tax. Certain Section 125 cafeteria plan deductions (e.g., health insurance premiums via payroll) may reduce Medicare wages.
How does self‑employment income affect the additional tax?
Additional Medicare Tax can apply to the combined amount of your Medicare wages and your self‑employment income. This tool estimates SE Medicare at 2.9% of 92.35% of net earnings and applies the 0.9% if you exceed your threshold.
Does my employer pay the 0.9% Additional Medicare Tax?
No. Employers only pay 1.45% on all Medicare wages. The 0.9% additional is an employee‑only tax.
Is this calculator a substitute for professional advice?
No. It is for educational estimation only. Please consult the IRS materials and a qualified tax professional for personalized guidance.
Authorship and Review
Tool developed by Ugo Candido. Content verified by CalcDomain Editorial Team. Last reviewed for accuracy on: .