Is the Additional Medicare Tax matched by the employer?

• A. No, the Additional Medicare Tax is paid by the employee and is not matched by the employer.
• B. Yes, the employer also pays 0.9% when employee pays.
• C. It is paid by both employee and employer equally.
• D. It is a reduction to employee's wage base.

Answer: (A)

The Additional Medicare Tax is an employee-paid surcharge on Medicare wages above a threshold. The employer withholds this 0.9% from the employee’s pay once wages exceed the threshold, but there is no employer matching of this tax. In contrast, the regular Medicare tax is 1.45% and is paid by both employee and employer. For example, if someone earns $210,000 in a year, $10,000 is subject to the 0.9% Additional Medicare Tax, so $90 is withheld from the employee’s pay. The employer does not contribute an additional amount to match that. So, this tax is paid by the employee, not matched by the employer.