Why is TurboTax saying I have an additional Medicare Tax when I am far under the income limit for that tax and requiring me to purchase an upgrade to complete my taxes?

[jceverts93]

My combined income was $119,000, which is well under the $250,000 required to have to pay this additional tax. TurboTax is saying I have this situation and won't let me file my taxes unless I pay $49 to upgrade to be able to handle this extra tax.

[MonikaK1]

It's possible that there was an inadvertent error on one of your W-2s. 

Form 8959 is used to calculate how much additional Medicare tax you may owe, depending on the type of income you earn. You should file Form 8959 if your Medicare or RRTA wages exceed $200,000 for single filers or $250,000 for joint filers.

If you entered any W-2s, navigate back to Wages & Income and check your entries. If you inadvertently, for example, added a digit to the amount in Box 5 so that your Medicare wages appeared to exceed $250,000, this would cause TurboTax to determine that the additional Medicare tax applies to you.

Please see this tips article for more information.

[RGlass81]

I am having the same issue. I read all the suggestions and my numbers are under the minimum amount for Medicare wages, percentages are exact for wages and taxes, I didn't click I had a 1095A or an HSA, I have cleared and started over and and reentered manually. Still trying to get me to upgrade. I'm very frustrated. I do not have MEDICARE!

[jceverts93]

I have double, triple, and quadruple checked my numbers, decimals, etc. and they're all correct, yet it's still saying I need this form/tax. 

[CatinaT1 · Accepted solution]

You are seeing this because the amount of Medicare taxes withheld in box 6 is not exactly 1.45% of the Medicare wages in box 5, due to rounding.

DoninGA found that if you remove any cents for the Medicare wages (Box 5), this will clear the need for Form 8959.

Double check your entries for your W2s. You could have a Box 6 withholding error or misplaced decimal point in Box 5 (e.g., entering $50,000.00 as $500,000) will trigger the form.

1. Go to Wages & Income and select Edit/Add next to your W-2.
2. Check Box 5 and Box 6 for every W-2 entered.
3. Ensure Box 6 is exactly 1.45% of Box 5. If it is off by a few cents (e.g., the W-2 shows $145.01 instead of $145.00), rounding it to the nearest dollar may remove the form requirement.

If the amount in Box 6 (Medicare tax withheld) is more than 1.45% of the amount in Box 5 (Medicare wages), TurboTax must generate Form 8959 to claim a refund of that overpayment. Even a discrepancy of $1 due to employer rounding can trigger this.

If your W2 entries are correct, delete the form:

1. Select Tax Tools from the left menu, then Tools.
2. Select Delete a form.
3. Find Form 8959 and click Delete.
4. Note: If the data in your W-2 still points to an overpayment, TurboTax will automatically re-generate the form during the final review.

[ashleykay]

Nope, still did not work for me! I only have two W-2's

First one

Box 5 $88398.89 Box 6 $1281.78

1.45% of Box 5 is 1281.783905

Second one

Box 5 $2178.75 Box 6 $31.59

1.45% of Box 5 is 31591875

Those are spot on, tried to delete the form as your next step - went back to file and nope, popped right back up saying that i have additional medicare. And it looks like this problem has been persisting since mid January and they still havent fixed it? Looks desperate for a money grab on Turbo Tax's part to me!! 

[VolvoGirl]

Did you try leaving the cents completely off of box 6?  Also delete the W2s and enter them again Manually.  That ususally clears something out.  

[willrphysics]

Thanks, CatinaT1. That fixed it for me. I just had to go to box 6, round down to the nearest dollar, and then deleted the Form 8959 from the Tax Tools ⇾ Tools menu. My box 6 was at 1.45%, but it wouldn't take the requirement away without rounding down for some reason. 

[Goldilocks1112]

I got it to work by not rounding the amount of Medicare withheld up. Mine was XXXX .61 cents and I just left the whole number there and put .00 cents, and it worked.

[Iridenhour0427]

Yup me too I tried to delete it just like she said and it tells me I don’t even qualify for additional Medicare and I’m like?? That’s what I’m trying to tell youu?? Then I proceed with filing my taxes yet in the end it says I still have additional Medicare tax so I’m fully convinced it’s a turbo tax problem and I hope they fix it soon 

[DawnC]

Do not enter any cents into the fields on the w-2, round down.   Make sure the amount in box 6 is 1.45% or less than the amount in box 5.   You may want to delete the w-2 and re-enter it if the issue persists.  

How to delete forms in TurboTax Online 
 

How to delete forms in TurboTax Desktop