When must an employer withhold Additional Medicare Tax?
Answer:
The statute requires an employer to withhold Additional Medicare Tax on wages it pays to an employee in excess of $200,000 in a calendar year, beginning January 1, 2013.
An employer has this withholding obligation even though an employee may not be liable for Additional Medicare Tax because, for example, the employee’s wages together with that of his or her spouse do not exceed the $250,000 threshold for joint return filers.
Any withheld Additional Medicare Tax will be credited against the total tax liability shown on the individual’s income tax return (Form 1040).
An employer has this withholding obligation even though an employee may not be liable for Additional Medicare Tax because, for example, the employee’s wages together with that of his or her spouse do not exceed the $250,000 threshold for joint return filers.
Any withheld Additional Medicare Tax will be credited against the total tax liability shown on the individual’s income tax return (Form 1040).
Interested in more Medicare Tax Additional Questions?
- When does Additional Medicare Tax start?
- What individuals are subject to the Net Investment Income Tax?
- What wages are subject to Additional Medicare Tax?
- What Railroad Retirement Tax Act (RRTA) compensation is subject to Additional Medicare Tax?
- Will Additional Medicare Tax be withheld from an individual's wages?
