Dividend income can also prompt the Additional Medicare Tax.
This tax is in addition to any income tax you may owe on the dividends. If you're single with a modified adjusted gross income of $200,000 or more, or if you're married and your MAGI is more than $250,000, you must pay an additional 3.8 percent of your net investment income toward Medicare tax. All taxable dividends are considered investment income, even if they're taxed at ordinary rates.
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