Social Security and Medicare are financed through a flat tax on wages paid up to a predetermined limit.

Question

Quizplus · Accepted Answer

Social Security and Medicare are funded through a payroll tax where employees and employers are each responsible for contributing 6.2% and 1.45% respectively of the employee's taxable wages up to a certain limit. The limit for Social Security taxes is $142,800 in 2021, while there is no limit for the Medicare payroll tax.

Social Security and Medicare Are Financed Through a Flat Tax