Medicare Tax Calculator
Updated August 2026 · Free · No sign-up
Calculate Medicare tax on any income: the 1.45% employee rate, the matching employer share, and the Additional Medicare Tax of 0.9% above $200,000 — with no wage cap, ever.
Quick answer: Medicare tax = 1.45% of all wages (no cap) + employer match of 1.45% + an Additional 0.9% employee-only surtax on wages above $200,000. On a $75,000 salary: $1,087.50 employee Medicare; on $250,000: $3,625 + $450 additional = $4,075.
How Medicare Tax Works
Medicare tax funds Medicare hospital insurance and applies to every dollar of wages — there is no wage base cap (unlike Social Security). Three layers:
- Employee: 1.45% withheld from all wages.
- Employer match: 1.45% — invisible to you but real cost to them.
- Additional Medicare Tax: 0.9% on wages above $200,000 (withholding threshold) — employee-only, no match. Your true threshold at filing depends on filing status ($250k joint, $125k separate), reconciled on Form 8959.
Self-employed pay both halves — 2.9% — plus the 0.9% surtax above the thresholds, with a deduction for the employer-equivalent half.
Worked Examples
Example 1 — typical salary. $75,000: employee Medicare $1,087.50; employer matches $1,087.50 — $2,175 total flowing to Medicare from your job.
Example 2 — high earner. $250,000 single filer: base 1.45% = $3,625, plus 0.9% on the $50,000 above $200k = $450 → $4,075 employee-side. The employer matches only the 1.45% ($3,625).
Example 3 — the married-couple catch. Two spouses each earning $150,000: neither employer withholds the surtax (each under $200k), but jointly they're $50,000 over the $250k threshold → $450 owed at filing via Form 8959. The classic dual-income surprise — fixable with extra W-4 withholding.
Medicare vs Social Security Tax
| Medicare | Social Security (OASDI) | |
|---|---|---|
| Employee rate | 1.45% (+0.9% over threshold) | 6.2% |
| Wage cap | None | Annual wage base (~$176,100) |
| Employer match | 1.45% (not the 0.9%) | 6.2% |
| High earners | Pay MORE (surtax) | Stop paying (cap) |
Run the Social Security side in the OASDI calculator or both together in the FICA calculator.
What Reduces Medicare Wages (Very Little)
The list is short: Section 125 cafeteria items — employer health/dental/vision premiums, FSA contributions, and payroll HSA contributions — reduce Medicare wages. Notably NOT: 401(k) contributions (Medicare-taxable in full), and virtually all cash compensation including bonuses, severance, PTO payouts, and stock compensation at vest. Payroll HSA contributions are the practical lever: the only mainstream way high earners shave the uncapped 1.45%+0.9%.
The Additional Medicare Tax, Properly Understood
- Withholding is mechanical: employers must start the extra 0.9% once YOUR wages with THEM pass $200,000 in the year — regardless of filing status or spouse income.
- Liability is joint: Form 8959 reconciles against the household threshold — dual-earner couples often owe more (each under $200k) while a married-separate filer may have overwithheld ($125k threshold).
- Investment income has its own cousin: the 3.8% Net Investment Income Tax uses the same thresholds — wages get 0.9%, investment income gets 3.8%, never both on the same dollar.
- RSU/bonus spikes: a vesting event that pushes annual wages past $200k triggers the surtax on everything above the line that year — see how supplemental payments interact in the bonus tax calculator.
Self-Employed Mechanics
Schedule SE applies 2.9% to 92.35% of net self-employment earnings (the 7.65% haircut mirrors the employee-side exclusion), plus the 0.9% surtax above your filing threshold. Half the base SE Medicare (the "employer" half) is deductible above-the-line. Freelancers comparing W-2 offers should remember: the extra 1.45% is part of why a contract rate must exceed a salary rate — the full conversion lives in the hourly to salary calculator.
Why There's No Cap
Social Security benefits are earnings-linked (capped contributions ↔ capped benefits), but Medicare hospital coverage is uniform — Congress removed the Medicare wage cap in 1993 and added the surtax in 2013 (ACA funding). Practical upshot: Medicare tax is the one payroll tax that scales without limit — on a $1M salary it's $16,700 employee-side, more than the maxed-out Social Security tax.
Frequently Asked Questions
What is the Medicare tax rate?
1.45% of all wages for employees plus a 1.45% employer match — and an Additional 0.9% employee-only surtax on wages above $200,000 ($250,000 married filing jointly, reconciled at filing).
Is there a cap on Medicare tax?
No — unlike Social Security's wage base, Medicare applies to every dollar of wages, and high earners pay an ADDITIONAL 0.9% above the thresholds.
How much Medicare tax on $100,000?
$1,450 employee-side (1.45%), matched by $1,450 from the employer. No surtax applies below $200,000.
What is the Additional Medicare Tax?
A 0.9% employee-only tax on wages above $200,000 (withholding trigger). Actual liability uses filing-status thresholds — $250k joint, $125k separate — settled on Form 8959.
Why was Additional Medicare Tax withheld from my bonus?
A bonus or RSU vest that pushes your year-to-date wages past $200,000 with one employer triggers mandatory 0.9% withholding on the excess for the rest of the year.
Do both spouses' incomes count for the 0.9%?
At filing, yes — the joint threshold is $250,000. Two $150k earners owe the surtax on $50k even though neither employer withheld it; adjust W-4 extra withholding to avoid an April bill.
What is the self-employed Medicare rate?
2.9% (both halves) on 92.35% of net self-employment earnings, plus the 0.9% surtax above your filing threshold — with the employer-equivalent half deductible.
Does 401(k) reduce Medicare tax?
No — traditional 401(k) deferrals remain fully Medicare-taxable. Section 125 health premiums, FSA, and payroll HSA contributions are the items that do reduce it.
Is Medicare tax refundable if I overpay?
Over-withheld Additional Medicare (e.g., married-separate with a $125k threshold, or job changes) reconciles on Form 8959 — excess comes back through your return.
What does Medicare tax pay for?
Medicare Part A hospital insurance. Coverage eligibility at 65 comes from 40 quarters of Medicare-taxed work — the tax is uncapped precisely because the benefit is uniform.
✓ Formula verified • Last updated: August 20, 2026