The 0.9% Additional Medicare Tax on Your Paycheck
Payroll starts the extra 0.9% at $200,000 with one employer, but the IRS settles it at $250,000 joint. Why the gap leaves high earners owing in April.
This article is general information, not tax or financial advice. Tax rules change, individual situations vary, and every figure here is an estimate. Confirm specifics with a qualified tax professional before making money decisions.
Your Medicare line went up partway through the year and nothing else on the stub moved. Or you filed, and there was a few hundred dollars sitting on the return that no paycheck ever withheld.
Both come from the same tax, and that tax has two halves that disagree with each other. Payroll withholds an extra 0.9% once your wages with one employer pass $200,000, with your filing status ignored. The IRS then settles the real bill against your filing-status threshold on Form 8959: $250,000 if you file jointly, $125,000 if you file separately.
When those two numbers don’t line up, money goes missing in one direction or the other. A couple earning $180,000 and $150,000 has $0 withheld and owes $720. A single-earner couple at $240,000 has $360 withheld and owes nothing at all.
The gap is mechanical, and so is the fix. Four cases first, then the one W-4 line that closes it.
What the 0.9% actually is, and what it is not
Base Medicare tax is 1.45% of every dollar of wages. There is no cap and no phase-out. Your employer matches it, so 2.9% total goes to Medicare on your earnings.
The Additional Medicare Tax is a further 0.9% on wages above a threshold. Your employer does not match this piece. Above the line, you pay 2.35% on those dollars and your employer still pays 1.45%.
It arrived with the Affordable Care Act and took effect in 2013. Neither the rate nor the thresholds have moved since.
Three things it gets confused with
The Social Security wage base. Social Security tax stops for the year once your wages hit $184,500 in 2026. Medicare works in the opposite direction: it never stops, and past $200,000 it gets worse. If your check got bigger mid-year, that was the Social Security cap, not this.
The 3.8% net investment income tax. Same ACA vintage, and the thresholds look similar, but the base is completely different. The 3.8% applies to investment income (interest, dividends, capital gains, passive rents). The 0.9% applies to wages and self-employment income. You can owe both in one year, but the same dollar is never hit by both.
A tax bracket. It isn’t one. There is no graduation and no ceiling. Every wage dollar above your threshold carries the extra 0.9%, forever, at the same rate.
The $200,000 rule your employer follows is not your rule
This mismatch drives everything else in this article.
| What triggers it | Set by | |
|---|---|---|
| Employer withholding | Wages over $200,000 with that one employer, in that calendar year. Filing status ignored. Other employers’ wages ignored. | IRS Topic 560 |
| Your actual liability | 0.9% on combined Medicare wages over your filing-status threshold, settled on Form 8959 | Form 8959 instructions |
Your employer is not being careless. It has no legal way to see your spouse’s W-2 or your second job’s payroll, so the law gives it one flat number to apply and tells it to ignore everything else.
The 2026 liability thresholds
| Filing status | Threshold |
|---|---|
| Single | $200,000 |
| Married filing jointly | $250,000 |
| Married filing separately | $125,000 |
| Head of household | $200,000 |
These are statutory, not indexed for inflation, and identical to what they were in 2013. That matters more every year. A $200,000 salary was an unusual number in 2013 and is a much more ordinary one now, so the pool of people crossing this line keeps growing without Congress touching a thing.
Finding it on your stub
The surtax usually shows up one of two ways: a second Medicare row labeled something like Med Addl, Addl Medicare, or Medicare Surtax, or the same Medicare row suddenly computing at a higher rate against your gross.
Two checks confirm it. The extra 0.9% applies only to the wages above $200,000, so the first affected check often shows an odd partial amount rather than a clean 0.9% of gross. And the YTD Medicare wages column will read just over $200,000. If other rows on the stub are unfamiliar, our pay stub code decoder covers the rest of the abbreviations.
Four ways this goes wrong, with real numbers
Every failure mode falls out of the table above. These four cover most of the people it catches.
1. Dual-income couple, nothing withheld
You earn $180,000. Your spouse earns $150,000. Combined Medicare wages: $330,000.
Neither employer crosses $200,000, so neither one withholds a cent of surtax. Your joint threshold is $250,000, so Form 8959 computes ($330,000 − $250,000) × 0.9% = $720 owed at filing.
This is the most common version, and nothing on either paycheck warns you it is happening.
2. Single filer with two jobs
Two jobs at $150,000 each. Combined: $300,000. Neither employer hits $200,000, so again nothing is withheld.
Your single threshold is $200,000, so the bill is ($300,000 − $200,000) × 0.9% = $900 owed.
Two-job earners usually have a second, larger under-withholding problem stacked on top of this one, because federal income tax withholding also assumes each job is your only job. That is what the W-4 two-jobs adjustment exists to fix.
3. Married filing separately at $150,000
One job, $150,000, which is not a “high earner” salary by any headline definition. Payroll withholds nothing, because $150,000 is well under $200,000.
But the married-filing-separately threshold is $125,000. Your liability is ($150,000 − $125,000) × 0.9% = $225 owed.
If you separated during the year and are filing apart for the first time, this one arrives with no warning at all. The threshold that applies to you is half the joint number, and payroll has no idea.
4. The mirror image: over-withheld
A single-earner married couple, one spouse at $240,000. Payroll crossed $200,000, so it withheld ($240,000 − $200,000) × 0.9% = $360.
The joint threshold is $250,000, so the actual liability is $0. The full $360 comes back as a credit on Form 1040 line 25c, folded into your refund.
Nothing is lost here, but nothing is earned either. It was an interest-free loan to the Treasury for however many months it sat there.
The four side by side
| Scenario | Medicare wages | Withheld by payroll | Form 8959 liability | Result |
|---|---|---|---|---|
| MFJ, dual income | $180,000 + $150,000 | $0 | $720 | Owes $720 |
| Single, two jobs | $150,000 + $150,000 | $0 | $900 | Owes $900 |
| MFS, one job | $150,000 | $0 | $225 | Owes $225 |
| MFJ, single earner | $240,000 | $360 | $0 | $360 refunded |
The tax itself lands on Schedule 2 (Form 1040), line 11. Anything payroll already took is credited back on line 25c. The difference is what you write a check for.
Fixing it on your W-4, Step 4(c)
Start with the part almost every article gets wrong: you cannot ask your employer to withhold Additional Medicare Tax for you. The IRS is explicit about this. No mechanism exists, and a payroll department that wanted to help you couldn’t.
What you can do is add extra income tax withholding on Form W-4, Step 4(c). That money is credited against the total tax shown on your return, and Additional Medicare Tax is part of that total. It plugs the hole even though it is technically a different tax going in.
The arithmetic
Four lines, done once:
- Estimate your combined household Medicare wages for the full year (both jobs, both spouses, plus bonuses and vesting equity).
- Subtract your filing-status threshold.
- Multiply by 0.9%.
- Subtract anything payroll has already withheld, then divide by the number of paychecks left in the year.
Run it on the $720 couple from scenario one, with 14 biweekly checks remaining: $720 ÷ 14 = about $52 per check on Step 4(c). That’s the whole fix. Our guide to adjusting take-home pay on your W-4 covers the rest of the form, and the W-4 withholding planner lets you test a 4(c) figure before you hand the form to HR.
Estimated payments and the 110% trap
Quarterly estimated payments (Form 1040-ES) do the same job. They are the right tool if you are self-employed or your income is lumpy.
But withholding has one advantage worth knowing. The IRS treats withheld tax as paid evenly across the year regardless of when it actually came out, so a Step 4(c) bump in October can cure a shortfall that started in March. A December estimated payment cannot do that.
That matters because of the underpayment safe harbor. You generally avoid a penalty by paying 90% of this year’s tax or 100% of last year’s, but that second figure rises to 110% if your prior-year AGI was over $150,000 ($75,000 if married filing separately). Readers of this article are, by definition, sitting right in that band. An unwithheld surtax is often exactly what tips an otherwise fine return into a penalty.
What doesn’t reduce it, and what does
The most common piece of advice here is also wrong. “Just max your 401(k) and get under the threshold” does not work.
Traditional 401(k), 403(b), and 457(b) deferrals reduce your federal income tax wages (W-2 box 1). They stay fully inside your Medicare wages (W-2 box 5), which is the figure this tax is measured against. Defer the full $24,500 for 2026 and your Additional Medicare Tax does not move by a dollar. That same box 1 versus box 5 split is why 401(k) contributions still pay FICA.
What actually shrinks box 5:
- Section 125 cafeteria plan health, dental, and vision premiums
- Health FSA contributions
- Dependent care FSA contributions
- HSA contributions made through payroll (not ones you deposit yourself)
These are genuinely exempt from Social Security and Medicare wages, so they lower the number the surtax is calculated on. The HSA and FSA paycheck impact calculator shows what each one does to a check.
Bonuses and RSUs are how most people cross the line
Vesting RSUs and annual bonuses are Medicare wages. A single vest or a March bonus can push box 5 past $200,000 in one pay period, which is why plenty of people cross this threshold in a year they never got a raise.
If equity is part of your comp, how RSU vesting hits take-home pay walks through what those pay periods look like. And if the surprise on your return was bigger than $720, it probably wasn’t just this tax; the withholding mistakes that quietly cost you covers the rest of the usual suspects.
Check box 5 before April does it for you
Pull last year’s W-2 and look at box 5. Add your spouse’s box 5, and any second job. If that combined number is above your filing-status threshold, you are running an unwithheld liability right now, this month, with nothing on your stub to say so.
Most calculators can’t see this, because they assume one job and a January start. Stub44’s Salary Calculator models the Medicare line as base rate plus the 0.9% above the statutory thresholds, and its year-to-date FICA-taxable earnings field is what makes a mid-year crossing come out exact rather than estimated.
Two saved profiles (one per job, or one per spouse) give you the combined-wage picture payroll structurally cannot see, and the two-income household calculator does the same job for a couple. Extra W-4 withholding per period is a first-class input, so you can test a Step 4(c) amount and watch what it does to your net check before you commit to it.
When you want your own numbers instead of these examples, download Salary Calculator and run them in about a minute.
Frequently Asked Questions
What is the additional Medicare tax threshold for 2026?
It depends on how you file: $200,000 for single and head of household, $250,000 married filing jointly, and $125,000 married filing separately. These thresholds are set by statute, are not adjusted for inflation, and have not moved since the tax took effect in 2013. Your employer follows a separate $200,000 trigger that ignores your filing status entirely.
Why did my Medicare withholding go up on my paycheck?
Your year-to-date wages with that employer passed $200,000, so the employer is required to withhold an extra 0.9% on every dollar above that point. Your marginal Medicare rate on those dollars is now 2.35% instead of 1.45%. Unlike Social Security, it does not switch off later in the year.
Do married couples owe additional Medicare tax at $250,000?
Yes, on combined Medicare wages above $250,000. But if each spouse earns under $200,000, neither employer withholds anything. A couple at $180,000 and $150,000 has $0 withheld and owes $720 at filing.
How do I avoid owing additional Medicare tax at filing?
You cannot ask payroll to withhold the surtax specifically, because no mechanism exists for it. Instead, add extra income tax withholding on Form W-4 Step 4(c), which is credited against every tax on your return including this one. Divide your expected shortfall by the number of paychecks left in the year.
Does my employer match the 0.9% additional Medicare tax?
No. There is no employer match on the additional 0.9%. Your employer still matches the base 1.45%, so above the threshold you pay 2.35% on those wages and your employer pays 1.45%.
Is the 0.9% additional Medicare tax the same as the 3.8% net investment income tax?
No. Both came out of the Affordable Care Act and their thresholds look similar, but the 0.9% applies to wages and self-employment income while the 3.8% applies to investment income like interest, dividends, and capital gains. You can owe both in the same year, but never on the same dollar.
What happens if too much additional Medicare tax was withheld?
It is credited on Form 1040 line 25c against your total tax and comes back in your refund. This is common for a single-earner married couple: $240,000 of wages triggers $360 of withholding against a $0 liability, because the joint threshold is $250,000.
Will maxing my 401(k) get me under the additional Medicare tax threshold?
No. Traditional 401(k), 403(b), and 457(b) deferrals reduce your federal income tax wages but stay inside Medicare wages, which is W-2 box 5 and the figure this tax measures. Section 125 health premiums, health and dependent care FSAs, and payroll HSA contributions do reduce box 5.