topic Additional Medicare Tax in Get your taxes done using TurboTax

Additional Medicare Tax

tangenashrob — Wed, 31 Jan 2024 22:18:50 GMT

I've completed entering my information into TurboTax and was expecting to have an additional medicare tax liability but it was not included in the amount calculated and therefore I'm wondering whether I misunderstood the requirement or there is a glitch in the system, which I realize is incredibly unlikely. On Form 8959, line 1, I have $265,978, which is the sum of the amounts from my and my spouse's W2 box 5 Medicare wages and tips ($199,567+$66,411). Since both are under $200,000, the extra medicare tax was not withheld. Lines 2, 3, and 4 are $0. I'm filing joint, so line 5 is $250,000 and line 6 is $265,978 - 250,000= 15,978. In Line 7 I multiply that by 0.009 to get an additional medicare tax of $144. In my draft TurboTax return, that $144 is not included in my total liability. I uploaded the W2s so that amounts in box 5 are definitely in the data I submitted. Do I not really owe this or how can I get the TurboTax to recalculate?

Re: Additional Medicare Tax

RobertB4444 — Wed, 31 Jan 2024 22:37:09 GMT

Additional medicare tax is owed on an individual employee basis - not a joint basis. Since neither of you individually earned over $200,000 you do not owe this additional tax.

Here's the IRS Tax Topic on this.

@tangenashrob

Re: Additional Medicare Tax

tangenashrob — Thu, 01 Feb 2024 00:18:27 GMT

@RobertB4444 wrote:

Here's the IRS Tax Topic on this.

Example 5 in there matches my exact situation and indicates that I do: "

Example 5. Erin and Frank are married and file jointly. Erin has $150,000 in wages and Frank has $175,000 in wages. Neither Erin nor Frank has wages that exceed $200,000. Therefore, their employers didn't withhold Additional Medicare Tax. However, their combined $325,000 in wages exceeds the $250,000 threshold for joint filers. Erin and Frank are liable for Additional Medicare Tax on $75,000 of wages ($325,000 in wages minus the $250,000 threshold). Erin and Frank must file Form 8959."

Re: Additional Medicare Tax

RobertB4444 — Thu, 01 Feb 2024 01:12:49 GMT

Nope. You were spot on with your calculations in the first place and I should obviously have done more reading before I answered so quickly. Sorry about that.

I've been unable to get the error you're experiencing to occur, though. The form 8959 populates automatically and the tax is added to my total tax.

We'd like to take a look at your return and see what's going on, We'd like you to create a 'sanitized' version of your return for us to look at (one that removes all of the personal information but keeps the numbers so we can look at the math). Here's how you do that-

1. Click on your return

2. Click Online and select 'Send Tax File to Agent'

3. This will generate a message that a diagnostic copy will be created. Click on OK, the tax file gets sanitized and transmitted to us.

4. Please provide the 6 digit token number that was generated as a response here.

Thank you!

@tangenashrob

Re: Additional Medicare Tax

tangenashrob — Thu, 01 Feb 2024 01:59:45 GMT

It's 1170251

Re: Additional Medicare Tax

RobertB4444 — Thu, 01 Feb 2024 15:12:09 GMT

I received the sanitized return and reviewed it. Your form 8959 has the calculation exactly as you saw it. The additional medicare tax is then carried over to your form 1040 on line 23 and added to your total tax on line 24. Everything appears to be in order there.

@tangenashrob