Angie earned $124,200 during 2016.She is single,claims two withholding allowances,and is paid monthly.How much will Angie's employer withhold in Medicare taxes for 2016?

Question

Quizplus · Accepted Answer

Medicare tax rate is 1.45% of earnings, and there is no maximum limit. Angie's annual Medicare tax contribution will be:

$124,200 x 1.45% = $1,800.90

Since she is paid monthly, her employer will withhold 1/12th of this amount each month:

$1,800.90 / 12 = $150.08

However, since Angie claims two withholding allowances, she may be able to reduce the amount of Medicare tax withheld. This would depend on her total income, deductions, and credits for the year.

Angie Earned $124,200 During 2016