The inception of the Additional Medicare Tax occurred in 2013 as a part of the Affordable Care Act (ACA). This tax imposes an additional 0.9 percent on individuals with substantial incomes.
Taxpayers are subject to the Additional Medicare Tax if their employment earnings, self-employment profits, or other compensation (including their spouse’s earnings if they file jointly) surpass the designated threshold for their tax filing category.
If you foresee owing Additional Medicare Tax and realize that withholding will not cover the entire amount due, you might need to remit estimated tax payments.
The Additional Medicare Tax was established in 2013, targeting earnings, remuneration, and self-employed revenue exceeding a certain limit, in effect for tax years beginning after December 31, 2012.
Explore the “Questions and Answers for the Additional Medicare Tax” on the IRS website.
