Melody and Todd are married and have employee wages of $250,000 each in 2014. They have no other income. How much additional 0.9% Medicare surtax will Melody and Todd have to pay or receive as a refund when they file their 2014 income tax return?

Question

Melody and Todd are married and have employee wages of $250,000 each in 2014. They have no other income. How much additional 0.9% Medicare surtax will Melody and Todd have to pay or receive as a refund when they file their 2014 income tax return? ​

Quizplus · Accepted Answer

Melody and Todd's combined wages are $500,000. The additional 0.9% Medicare surtax applies to wages above $250,000 for married taxpayers filing jointly.

Their total wages above the threshold is $250,000 ($500,000 - $250,000).

So, the surtax amount is $250,000 x 0.9% = $2,250.

Since the surtax is withheld from the employees' wages throughout the year, it's likely that Melody and Todd had some of this amount already paid through their employer withholding. The question doesn't specify how much was already withheld, so we can't determine the exact amount due or refunded.

However, we know that at least some amount will be due with their return, so the only option that reflects this is A.

Melody and Todd Are Married and Have Employee Wages of $250,000