What is the Additional Medicare Tax?
It would help to know that only people that earn a certain level of money per year will be subject to The Additional Medicare Tax. Studies show that in 2013 the IRS asked people earning higher than average to pay more to Medicare. The additional tax was introduced as a part of the Affordable Care Act [1]. It was termed Additional Medicare T
ax. You will pay the extra tax at a rate of 0.9 percent. If you get employment wages, you will be asked to pay 2.35 percent, while entrepreneurs will pay 3.8 percent. Earnings from self-employment, wages, and some compensation such as Railroad Retirement (RRTA) compensation are all considered by the IRS as income to deduct from. Employers are given the right to withhold the tax from employees that are subject to it. Employees can also pay an approximated amount to the IRS for the year.