For a single taxpayer earning wages of $185,000 and self-employment income of $35,000, what is the required amount of Additional Medicare Tax?

For a single taxpayer earning wages of $185,000 and self-employment income of $35,000, what is the required amount of Additional Medicare Tax?

• A. $0
• B. $180
• C. $225
• D. $480

Answer: (B)

To determine the Additional Medicare Tax for a single taxpayer with a wage income and self-employment income, it is important to understand how the thresholds for this tax work. The Additional Medicare Tax applies to wages, compensation, and self-employment income that exceed certain income thresholds. For a single taxpayer, the threshold is $200,000. In this scenario, the taxpayer has wages of $185,000 and self-employment income of $35,000, bringing the total income to $220,000. The amount subject to the Additional Medicare Tax is calculated based on the income exceeding the threshold. First, we assess the taxpayer’s total income: - Wages: $185,000 - Self-employment income: $35,000 - Total income = $185,000 + $35,000 = $220,000 Next, we identify how much of this total exceeds the $200,000 threshold: - $220,000 (total income) - $200,000 (threshold) = $20,000 The Additional Medicare Tax is levied at a rate of 0.9% on the income exceeding the threshold: - $20,000 x 0.009 = $180 Therefore, the required amount

To determine the Additional Medicare Tax for a single taxpayer with a wage income and self-employment income, it is important to understand how the thresholds for this tax work. The Additional Medicare Tax applies to wages, compensation, and self-employment income that exceed certain income thresholds. For a single taxpayer, the threshold is $200,000.

In this scenario, the taxpayer has wages of $185,000 and self-employment income of $35,000, bringing the total income to $220,000. The amount subject to the Additional Medicare Tax is calculated based on the income exceeding the threshold.

First, we assess the taxpayer’s total income:

• Wages: $185,000

• Self-employment income: $35,000

• Total income = $185,000 + $35,000 = $220,000

Next, we identify how much of this total exceeds the $200,000 threshold:

• $220,000 (total income) - $200,000 (threshold) = $20,000

The Additional Medicare Tax is levied at a rate of 0.9% on the income exceeding the threshold:

• $20,000 x 0.009 = $180

Therefore, the required amount