Medicare tax

Definition

Tax deducted from the wages of every legally working American that is used to pay for the Medicare program provided to individuals over the age of 65. This is typically another line item included on an employee's paystub. At the end of year, the employer will provide the employee with a W-2 and this will include the total amount deducted from the individual's paycheck for the Medicare tax. The tax was implemented under the Federal Insurance Contributions Act.

Use Medicare tax in a sentence

You need to remember to factor in your Medicare tax when you are trying to calculate your annual earnings.

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The Medicare tax was initially not well received by the starving student worker until he realized that he was helping others.

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You are paying Medicare tax every week but someday you will be elderly and if you are a recipient of Medicare, your bills will be paid by hardworking individuals just like you right now.

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1040-SS Form taxable wage base