There is a chance that certain individuals will owe more than expected this year due to Additional Medicare Taxes.
This is a .9% surtax on wages, compensation, or self employment income that exceeds the following thresholds:
• $250,000 for Couples Filing Jointly
• $200,000 for Individuals
• $125,000 for Married Filing Separately
For employers, this means that an additional .9% must be withheld from any individual who has wages in excess of $200,000, regardless of the individuals filing status or wages paid to another employer.
For some taxpayers, this extra tax may come as a surprise – especially if you have more than one source of qualified income, or if you are a married couple filing jointly.
So then, the question is: what can you do about it?
It’s a little late to have the employer hold and additional amount from wages. Instead, you could make an estimated payment for the fourth quarter (due January 15th) or you can prepare now to pay when you file your tax return and send it on April 15th.
