To have and to withhold: The complications of the PPACA — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
  • LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

To have and to withhold: The complications of the PPACA

Get PDF file

by on
in Small Business Tax

The 3.8% Medicare surtax on net investment income isn’t the only tax complication triggered by the Patient Protection and Affordable Care Act (PPACA). Under the PPACA, an additional 0.9% Medicare tax applies to wages received by employees above $200,000 for single filers, heads of households and qualifying widows and widowers; $250,000 for joint filers; or $125,000 for married taxpayers filing separately. The additional 0.9% Medicare surtax also hits net self-employment income in excess of the aforementioned thresholds.

The IRS recently refreshed the Frequently Asked Questions (FAQs) section for the 0.9% Medicare surtax on its website. For instance, the FAQs explain that wage withholding of the 0.9% surtax must begin in 2015 when an employee earns more than $200,000 even though a married employee and his or her spouse may not have combined wages above the $250,000 threshold for married joint filers.

Related Articles...

Leave a Comment

Previous post:

Next post: