Additional Medicare Tax Calculator

Q: What is the Additional Medicare Tax?

The Additional Medicare Tax is a 0.9 percent surtax on Medicare wages, self-employment income, and railroad retirement (RRTA) compensation above a threshold that depends on filing status: $250,000 for married filing jointly, $125,000 for married filing separately, and $200,000 for everyone else. It was created by the Affordable Care Act and applies to tax years beginning after December 31, 2012. It is computed on IRS Form 8959 and reported on Schedule 2, line 11 of Form 1040. Sources: IRC section 3101(b)(2) and IRS Topic 560.

Q: When does my employer withhold the extra 0.9% Medicare tax?

An employer must withhold the 0.9 percent Additional Medicare Tax on wages it pays to an employee above $200,000 in a calendar year, regardless of the employee's filing status or other income. Withholding starts in the pay period in which year-to-date wages cross $200,000. The employer rule and your actual liability use different thresholds, so the amount withheld often does not match the amount you owe; Form 8959 Part V reconciles the difference. There is no employer match on the 0.9 percent.

Q: Is there an employer match for the Additional Medicare Tax?

No. Unlike the regular 1.45 percent Medicare tax, which the employer matches with its own 1.45 percent, the 0.9 percent Additional Medicare Tax is imposed only on the employee. The employer's duty is limited to withholding it on wages above $200,000 in the calendar year. The IRS Questions and Answers page on the Additional Medicare Tax states this directly: there is no employer match for Additional Medicare Tax.

Q: Does the Additional Medicare Tax apply to investment income?

No. The 0.9 percent Additional Medicare Tax applies only to earned income: Medicare wages, self-employment income, and RRTA compensation. Investment income such as interest, dividends, and capital gains is instead subject to the separate 3.8 percent Net Investment Income Tax (NIIT) under IRC section 1411, computed on Form 8960, which uses the same $200,000/$250,000/$125,000 MAGI thresholds. A high earner can owe both taxes in the same year, but never both taxes on the same dollar of income.

Quick Facts (Source: IRC §3101(b)(2), §1401(b)(2), IRS Topic 560, Form 8959 Instructions)
Item	Value	Status
Rate	0.9% of earned income above the threshold	Confirmed
Threshold - married filing jointly	$250,000	Confirmed
Threshold - married filing separately	$125,000	Confirmed
Threshold - single / HOH / QSS	$200,000	Confirmed
Inflation adjustment	None - fixed by statute since 2013	Confirmed
Employer withholding trigger	Wages above $200,000 per employer, any filing status	Confirmed
Employer match	None (employee-only tax)	Confirmed
Self-employment threshold	Reduced (not below zero) by Medicare wages	Confirmed
Half-of-SE-tax deduction	Excludes the 0.9% (§164(f))	Confirmed
Where reported	Form 8959 → Schedule 2, line 11; withholding → 1040 line 25c	Confirmed
Effective date	Tax years beginning after Dec 31, 2012 (ACA)	Confirmed

The three Medicare-related taxes compared
Feature	Regular Medicare	Additional Medicare	NIIT
Rate	1.45% employee + 1.45% employer (2.9% SE)	0.9% employee only	3.8%
Applies to	All Medicare wages / SE income, no cap	Earned income above threshold	Investment income above MAGI threshold
Threshold	None (first dollar)	$250K / $125K / $200K	$250K / $125K / $200K (MAGI)
Employer match	Yes	No	n/a
Form	W-2 / Schedule SE	Form 8959	Form 8960
Statute	§3101(b)(1), §1401(b)(1)	§3101(b)(2), §1401(b)(2)	§1411

What is the Additional Medicare Tax?

The Additional Medicare Tax is a 0.9% surtax on Medicare wages, self-employment income, and railroad retirement (RRTA) compensation above a threshold that depends on filing status: $250,000 for married filing jointly, $125,000 for married filing separately, and $200,000 for everyone else. It was created by the Affordable Care Act and applies to tax years beginning after December 31, 2012. It is computed on IRS Form 8959 and reported on Schedule 2, line 11 of Form 1040. Sources: IRC section 3101(b)(2) and IRS Topic 560.

What are the Additional Medicare Tax income thresholds?

The thresholds are $250,000 for married filing jointly, $125,000 for married filing separately, and $200,000 for single, head of household, and qualifying surviving spouse filers. They are written directly into IRC section 3101(b)(2) and section 1401(b)(2) and are not indexed for inflation, so they have been the same since the tax took effect in 2013. As wages rise over time, more taxpayers cross them each year.

When does my employer withhold the extra 0.9% Medicare tax?

An employer must withhold the 0.9% Additional Medicare Tax on wages it pays to an employee above $200,000 in a calendar year, regardless of the employee's filing status or other income. Withholding starts in the pay period in which year-to-date wages cross $200,000. The employer rule and your actual liability use different thresholds, so the amount withheld often does not match the amount you owe; Form 8959 Part V reconciles the difference. There is no employer match on the 0.9%.

Why do married couples owe Additional Medicare Tax at filing time?

Each employer withholds only on wages it pays above $200,000, but a joint return owes the tax on combined Medicare wages above $250,000. Two spouses earning $150,000 each have no withholding (neither crosses $200,000 with one employer), yet they owe 0.9% on $50,000 of combined wages, which is $450 due with the return. Couples in this position can add extra income tax withholding on Form W-4 (line 4c) or make estimated tax payments to avoid an underpayment penalty.

How does self-employment income affect the Additional Medicare Tax?

Self-employment income from Schedule SE, Part I, line 6 is subject to the 0.9% surtax, but the threshold is first reduced (not below zero) by your Medicare wages under IRC section 1401(b)(2)(B). For example, a single filer with $150,000 of wages compares self-employment income against a reduced threshold of $50,000. A self-employment loss is not considered for this tax, and the deduction for one-half of self-employment tax under IRC section 164(f) excludes the 0.9%, so no part of it is deductible.

Is there an employer match for the Additional Medicare Tax?

No. Unlike the regular 1.45% Medicare tax, which the employer matches with its own 1.45%, the 0.9% Additional Medicare Tax is imposed only on the employee. The employer's duty is limited to withholding it on wages above $200,000 in the calendar year. The IRS Questions and Answers page on the Additional Medicare Tax states this directly: there is no employer match for Additional Medicare Tax.

Where does the Additional Medicare Tax go on my tax return?

You compute the tax on Form 8959. The total from Form 8959, line 18 goes on Schedule 2 (Form 1040), line 11 and is added to your total tax. The Additional Medicare Tax your employer withheld, which Form 8959 Part V derives as box 6 Medicare withholding above 1.45% of box 5 wages, goes on Form 1040, line 25c with your other federal withholding, so it is credited against your total tax like any other withholding.

Does the Additional Medicare Tax apply to investment income?

No. The 0.9% Additional Medicare Tax applies only to earned income: Medicare wages, self-employment income, and RRTA compensation. Investment income such as interest, dividends, and capital gains is instead subject to the separate 3.8% Net Investment Income Tax (NIIT) under IRC section 1411, computed on Form 8960, which uses the same $200,000/$250,000/$125,000 MAGI thresholds. A high earner can owe both taxes in the same year, but never both taxes on the same dollar of income.

Quick Facts: Additional Medicare Tax (Tax Years 2025 and 2026)

How This Is Calculated

Step 1: Pick the Statutory Threshold Confirmed

Step 2: Wages Over the Threshold (Form 8959, Part I) Confirmed

Step 3: Self-Employment Income Over the Reduced Threshold (Part II) Confirmed

Step 4: RRTA Compensation, Compared Separately (Part III) Confirmed

Step 5: Reconcile Withholding (Part V) Confirmed

Assumptions

Additional Medicare Tax vs Regular Medicare Tax vs NIIT

Real-World Examples

Practitioner Insight (LMN Tax Inc.)

When This Estimate May Not Apply

Frequently Asked Questions

What To Do Next

Related Tools and Guides