2021 Additional Medicare Tax Threshold
For 2021, the Additional Medicare Tax Threshold is 0.9% (Rate), $250,000 (Married filing jointly) and $125,000 (Married filing separately).
Effective 2021-01-01Source: 2021 Instructions for Form 8959 (IRS)Verified 2026-08-29
Compared with 2020
Every figure on this page is unchanged from 2020.
| Item | 2020 | 2021 | Change |
|---|---|---|---|
| Rate | 0.9% | 0.9% | +0% (+0.0%) |
| Married filing jointly | $250,000 | $250,000 | +$0 (+0.0%) |
| Married filing separately | $125,000 | $125,000 | +$0 (+0.0%) |
Who it applies to
Taxpayers who owe Additional Medicare Tax and file Form 8959 with their federal income tax return.
What changed this year, and why
For 2021, the Additional Medicare Tax rate and threshold amounts remain as established. A 0.9% Additional Medicare Tax applies to Medicare wages, Railroad Retirement Tax Act (RRTA) compensation, and self-employment income that exceed the threshold amount for the taxpayer's filing status.
Common questions
- What is the Additional Medicare Tax rate for 2021?
- The rate is 0.9%.
- What is the threshold for married taxpayers filing jointly?
- The threshold is $250,000.
- What is the threshold for married taxpayers filing separately?
- The threshold is $125,000.
- Are the threshold amounts adjusted for inflation?
- No. The IRS notes that the Additional Medicare Tax threshold amounts are not indexed for inflation.
Your employer withholds at $200,000 whatever your filing status
The employer-withholds-at-200k topic: The source says: "Your employer is responsible for withholding the 0.9% Additional Medicare Tax on your Medicare wages or RRTA compensation paid in excess of $200,000 in a calendar year." This means the 0.9% rate and the $200,000 withholding trigger apply regardless of the taxpayer's filing status - the employer does not ask whether you file single, married filing jointly, or otherwise. It begins withholding in the first pay period your year-to-date wages or compensation cross $200,000 and continues through the end of the calendar year. Because the $200,000 withholding threshold is fixed and does not match the $250,000 joint or $125,000 married-filing-separately thresholds, a taxpayer whose total income is below their filing-status threshold may have tax withheld anyway and can claim a credit on Form 8959. You cannot ask your employer to stop the 0.9% withholding once it has begun. If your combined wages and self-employment income put you above the $250,000 or $125,000 threshold, you may still owe more than was withheld and must cover the rest through estimated payments or withholding on other income.
Your employer is responsible for withholding the 0.9% Additional Medicare Tax on your Medicare wages or RRTA compensation paid in excess of $200,000 in a calendar year.
2021 Instructions for Form 8959, Additional Medicare Tax (IRS)
These thresholds do not move with inflation
The threshold amounts for the Additional Medicare Tax are fixed by statute and do not increase with inflation. The $250,000 amount for married taxpayers filing jointly and the $125,000 amount for married taxpayers filing separately remain constant until Congress changes them. Unlike many other tax figures that are adjusted annually for cost-of-living increases, these thresholds stay the same year after year. This means that as wages and self-employment income rise over time, more taxpayers may find themselves above the threshold and subject to the 0.9% tax even if their real income has not grown. Taxpayers should not assume the threshold will go up each year; they must use the amounts shown in the IRS chart for the specific tax year when determining whether they owe the tax or need to file Form 8959. The lack of inflation indexing is an important structural feature of the tax that can broaden its reach over time without any legislative action.
Note. The threshold amounts below aren't indexed for inflation.
2021 Instructions for Form 8959, Additional Medicare Tax (IRS)
When Form 8959 is required
The IRS requires you to file Form 8959 if any one of several conditions is met. You must file if your Medicare wages and tips reported on any single Form W-2 exceed the employer withholding trigger amount, if your Railroad Retirement Tax Act compensation on any single Form W-2 exceeds that same trigger, if your combined Medicare wages and self-employment income exceed the threshold for your filing status, or if your combined Railroad Retirement Tax Act compensation exceeds the threshold for your filing status. For married couples filing jointly, both spouses' amounts are combined when testing against the $250,000 threshold. Even if your employer did not withhold the 0.9% Additional Medicare Tax at all, you still must file the form if your total income exceeds the applicable threshold. The form reconciles what was withheld against what you actually owe, which may result in a credit for excess withholding or a balance due for any shortfall.
You must file Form 8959 if one or more of the following applies to you.
2021 Instructions for Form 8959, Additional Medicare Tax (IRS)
Wages and self-employment income are added together
For purposes of determining whether a taxpayer's income exceeds the applicable threshold amount for the Additional Medicare Tax, Medicare wages and self-employment income are added together as a single combined figure. The threshold is not applied separately to wages and to self-employment income; instead, the two categories are summed and the total is compared to the threshold for the taxpayer's filing status. A self-employment loss is not taken into account when making this comparison. By contrast, Railroad Retirement Tax Act compensation is treated differently and must be compared to the threshold on its own, separate from wages and self-employment income. This combining rule means that a taxpayer who has wages below the threshold and self-employment income also below the threshold may still owe the 0.9% tax when the two amounts together push total income above the applicable limit.
Medicare wages and self-employment income are combined to determine if your income exceeds the threshold.
2021 Instructions for Form 8959, Additional Medicare Tax (IRS)
Railroad compensation is measured on its own
Railroad Retirement Tax Act compensation is not added to Medicare wages or self-employment income when measuring whether a taxpayer owes the Additional Medicare Tax. Instead, such compensation is compared to the applicable filing-status threshold entirely on its own. This means a railroad employee must run a separate calculation for their Railroad Retirement Tax Act compensation, independent of any wages or self-employment income they may also have. An employer that pays Railroad Retirement Tax Act compensation must withhold the 0.9% tax once that compensation alone exceeds the employer-level trigger in a calendar year, regardless of the employee's filing status. Because this compensation is measured separately, it does not reduce the threshold available for self-employment income the way regular Medicare wages do. A railroad employee could owe the tax on their compensation even though their combined wages and self-employment income fall below the $250,000 joint threshold or $125,000 married-filing-separately threshold, or vice versa.
RRTA compensation should be separately compared to the threshold.
2021 Instructions for Form 8959, Additional Medicare Tax (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
2021 Instructions for Form 8959 (IRS)
- Rate
A 0.9% Additional Medicare Tax applies to your Medicare wages,
- Married filing jointly
Married filing jointly $250,000
- Married filing separately
Married filing separately $125,000