Mike Gundy is a college football coach making a salary of $2,400,000 a year ($200,000 per month).Employers are required to withhold a 6.2% Social Security tax up to a maximum base amount and a 1.45% Medicare tax with no maximum.Assuming the FICA maximum base amount is $106,800,how much will be withheld during the year for the coach's Social Security and Medicare.

Question

Quizplus · Accepted Answer

For Social Security tax, the maximum base amount is $106,800. Therefore, the amount subject to Social Security tax for Mike Gundy is $106,800. The withholding for Social Security tax would be 6.2% of $106,800, which is $6,621.60.

For Medicare tax, there is no maximum base amount. Therefore, the amount subject to Medicare tax for Mike Gundy is his entire salary of $2,400,000. The withholding for Medicare tax would be 1.45% of $2,400,000, which is $34,800.

The total amount withheld for Social Security and Medicare taxes would be $6,621.60 + $34,800 = $41,421.60, which rounds up to $41,422. Therefore, the best choice is B. None of the other answer choices are correct.

Mike Gundy Is a College Football Coach Making a Salary