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Reply #20: There's no limit on the Medicare tax. [View All]

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Home » Discuss » General Discussion: Presidency

Igel

(1000+ posts) Send PM | Profile | Ignore

Sun May-29-11 10:11 PM
Response to Original message

20. There's no limit on the Medicare tax.

Earn $50k, you pay the tax on it. Earn $500k, you pay the tax on the full amount. Earn $5M, you still pay the tax on the full amount.

It's 2.9%, 1/2 payable by the employee and 1/2 by the employer (unless you're self-employed, then you pay the full amount). In 2013 the tax becomes more "progresive" and over some amount of pay it rises to 3.8% ($200k for individuals, $250k for couples).

The cap was removed in '94. IIRC, the surcharge was instituted fairly recently.

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