Employer rules for withholding the new 0.9% Medicare tax

HRS Insight
Beginning in 2013, an additional 0.9% Medicare tax is imposed on individuals who receive wages over $200,000 ($250,000 in the case of a joint return, or $125,000 in the case of a married taxpayer filing separately). When added to the current 1.45% employee portion of the Medicare tax, a high-income taxpayer's wages will be subject to a 2.35% Medicare tax on wages above the threshold. There is no employer match for the additional Medicare tax - the employer's Medicare tax rate on wages paid to employees will continue to be 1.45%.


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