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8959 for 2023 Form: What You Should Know

It is not included in the computation of the adjusted gross income. For information on how Additional Medicare Tax is calculated and withheld, refer to Publication 519 (PDF). Use Form 8959 for the following calculations: To figure the amount of Additional Gross Income you owe, use Form 941. What is Publication 519? Federal income tax includes additional Medicare tax withholding from your  W-2's. This additional withholding is not included as taxable income. A worker is paid wages or compensation if you pay them with money, and the wages or compensation exceed the threshold amounts, in  whole dollars, shown in the following table. Filing and payment deadlines for this tax. The Additional Medicare Tax is included in the computation of your adjusted gross income, and is  not tax-free, as discussed in Publication 519 (PDF). Use Publication 519 to figure the Additional Medicare Tax. Form 8959 is a separate application from you are using to figure your income tax withholding and your Adjusted Gross Income. Use Form 941 and Form 941-SS (PDF) to figure your Additional Medicare Tax, if any, and to figure your adjusted gross income, if any, in the same way. You should not combine the forms. Additional tax is not automatically withheld. Therefore, if you are not required to file a tax return, you may not be required to file a Form 8959. Report this tax as if it were income tax withholding.  Do not deduct Additional Medicare Tax from your tax return if you are not required to file a federal tax return. You may deduct the Additional Medicare Tax but have not filed a federal tax return, and you are not required to file a return if  you are eligible for a refund or credit because all tax on the amount is refunded or creditable (or is refunded or credited).

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FAQ - Form 8959 for 2023

Who needs to fill out 8959?
The tax applies to wages from employment, self-employment income and railroad retirement income, but if you are receiving W-2 income, the tax will most likely be withheld from your wages. Either way, anyone subject to the tax is required to file Form 8959 with their annual income tax filing.
Are 401k contributions subject to the additional Medicare tax?
Contributions to a 401k are subject to social security and medicare tax, but not to ordinary income tax.
How do I fill out form 8959?
0.53 6.24 How to Complete IRS Form 8959 - Additional Medicare Tax - YouTube YouTube Start of suggested clip End of suggested clip So the 8959 is used to report an additional .9 percent medicare tax on earned compensation. SoMoreSo the 8959 is used to report an additional .9 percent medicare tax on earned compensation. So that's w-2 wages or self-employment income via schedule c or maybe you're a partner in a partnership.
How is additional Medicare tax calculated?
It is paid in addition to the standard Medicare tax. An employee will pay 1.45% standard Medicare tax, plus the .9% additional Medicare tax, for a total of 2.35% of their income....What is the additional Medicare tax? StatusTax thresholdmarried tax filers, filing separately$125,0003 more rows ‣ 24 Sept 2020
Do you pay Medicare tax on 401k contributions?
Contributions to a 401(k) are subject to Social Security and Medicare taxes, but are not subject to income taxes unless you are making a Roth (after-tax) contribution.
Who is subject to the additional Medicare tax?
A .9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation that exceed the following threshold amounts based on filing status. $250,000 for married filing jointly; $125,000 for married filing separately; and. $200,000 for all other taxpayers.
What is a 8559 form?
Use this form to figure. the amount of Additional Medicare Tax you owe and. the amount of Additional Medicare Tax withheld by your employer, if any.
Are all earnings subject to Medicare tax?
There's no wage base limit for Medicare tax. All covered wages are subject to Medicare tax.
Who must file form 8960?
Attach Form 8960 to your return if your modified adjusted gross income (MAGI) is greater than the applicable threshold amount. Use Form 8960 to figure the amount of your Net Investment Income Tax (NIIT). Controlled foreign corporation (CFC).
Why do I have to fill out form 8959?
Purpose of Form Use Form 8959 to figure the amount of Additional Medicare Tax you owe and the amount of Additional Medicare Tax withheld by your employer, if any. You will carry the amounts to one of the following returns. Form 1040.
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