Medicare Payroll Tax Will be Increasing for Some Wage Earners
Effective January 1, 2013, high-income wage earners will be required to pay a higher Medicare tax rate on their compensation due to the 2010 Health Care Bill. The Medicare tax rate is currently 1.45% and will increase to 2.35% for those who earn more than $200,000; $250,000; and $125,000 for single filers, filing jointly, and married filing separately respectively. The additional .9% is to cover the Hospital Insurance tax.
This new withholding will need to be reported on the 2013 W-2 in box 6. If you have questions, contact Lori Johnson, H&S Payroll Specialist, today.