Question

Income from which of the following is (are) deemed unearned income for purposes of the ACA's Medicare surtax on unearned income?

A) Real estate rental income
B) Wages and salary
C) Dividends
D) Stocks, Bonds, Capital gains

Answer 1

For the ACA's Medicare surtax, real estate rental income, dividends, and income from stocks, bonds, and capital gains are considered unearned income, whereas wages and salary are not.

Step-by-step explanation:

Income that is considered unearned for the purpose of ACA's Medicare surtax on unearned income includes real estate rental income, dividends, and income from stocks, bonds, and capital gains. Wages and salaries, on the other hand, are not deemed unearned income and thus are not subject to the Medicare surtax on unearned income. The ACA's Medicare surtax on unearned income is a 3.8 percent tax targeting high-income taxpayers to help fund the Affordable Care Act.