Question

Christine and Doug are married. In 2019, Christine earns a salary of $250,000 and Doug earns a salary of $50,000. They have no other income and work for the same employers for all of 2019. How much 0.9 percent Medicare tax for high-income taxpayers will Christine and Doug be required to pay with their 2019 income tax return?

Answer 1

Christine and Doug will be required to pay $4,350 in Medicare tax with their 2019 income tax return.

Step-by-step explanation:

To calculate the Medicare tax for high-income taxpayers, we need to know the gross annual income of Christine and Doug. Since Christine earns $250,000 and Doug earns $50,000, their combined gross annual income is $300,000. The Medicare tax rate is 1.45%, and it applies to all earned income.

So, the amount of Medicare tax Christine and Doug will be required to pay with their 2019 income tax return is:

Medicare tax = Gross annual income × Medicare tax rate

= $300,000 × 0.0145

= $4,350

Answer 2

A) $450

Step-by-step explanation:

The current Medicare tax for high-income taxpayers is 2.35% for employees and 3.8% for self-employed during 2019.

Since Christine and Doug are married, they must pay the regular 1.45% + 0.9% additional Medicare care for any income above $250,000.

So the additional Medicare tax = ($300,000 - $250,000) x 0.9% = $450

*Their total Medicare tax for 2019 = ($250,000 x 1.45%) + ($50,000 x 2.35%) = $4,800