Payroll tools and source-backed guidance
Medicare Tax — Payroll Definition
Medicare Tax paystub meaning: The 1.45% payroll tax that funds federal healthcare for seniors and disabled persons. Codes: MED / MEDEE.
The 1.45% payroll tax that funds federal healthcare for seniors and disabled persons.
Medicare tax is a 1.45% tax on ALL wages with no cap (unlike Social Security). High earners pay an additional 0.9% Medicare surtax on wages exceeding $200,000 (single) or $250,000 (married filing jointly), bringing their total Medicare rate to 2.35%. This tax funds Part A of Medicare, which covers hospital insurance for people 65 and older and those with certain disabilities.
Tax entries on a pay statement depend on taxable wages, current employee elections, filing status, pay frequency, jurisdiction, and current agency instructions. Compare the current-period amount with year-to-date totals and the employer-issued record before treating it as final.
When this term appears on a statement, read its label, current amount, year-to-date amount, pay-period context, and any adjacent rate or hours together. Resolve a mismatch with the original issuer or the cited authority rather than changing a record to force a preferred result.
Related terms
- FICA — Federal Insurance Contributions Act — the Social Security and Medicare tax on your paycheck.
- Social Security Tax — The 6.2% payroll tax that funds federal retirement and disability benefits (OASDI).
- Additional Medicare Tax — A 0.9% surtax on wages exceeding $200,000 (single) for high earners.