Ethan received $135,000 in salary in 2019.What is his FICA tax if the Medicare rate is 1.45% and the Social Security rate is 6.2% on the 2019 maximum of $132,900?
A)$10,327.50
B)$10,197.30
C)$10,166.85
D)$9,918.30

Question

Quizplus · Accepted Answer

Ethan's FICA tax is calculated on the 2019 maximum of $132,900 for Social Security, not his entire salary of $135,000. The Medicare tax, however, applies to the entire salary. So, the calculation is as follows: Social Security tax = $132,900 * 6.2% = $8,239.80. Medicare tax = $135,000 * 1.45% = $1,957.50. Total FICA tax = $8,239.80 + $1,957.50 = $10,197.30.

Ethan Received $135,000 in Salary in 2019