Question

The chief executive officer earns $21,500 per month. As of May 31, her gross pay was $107,500. The tax rate for Social Security is 6.2% of the first $137,700 earned each calendar year and the Federal Insurance Contributions Act (FICA) tax rate for Medicare is 1.45% of all earnings. The current Federal Unemployment Taxes (FUTA) tax rate is 0.6%, and the State Unemployment Taxes (SUTA) tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee’s pay. What is the amount of Federal Insurance Contributions Act (FICA) - Medicare withheld

from this employee for the month of June?

Answer 1

The amount of Federal Insurance Contributions Act (FICA) - Medicare withheld from the employee for the month of June is $1,558.75.

Step-by-step explanation:

The amount of Federal Insurance Contributions Act (FICA) - Medicare withheld from the employee for the month of June can be calculated by multiplying the Medicare tax rate of 1.45% with the employee's gross pay for the month. In this case, the gross pay for the month of May was $107,500. So, the amount of FICA - Medicare withheld for the month of June would be:

$107,500 * 0.0145 = $1,558.75

Therefore, the amount of Federal Insurance Contributions Act (FICA) - Medicare withheld from this employee for the month of June is $1,558.75.