Employees whose taxable Medicare wages are over $200,000 will be subject to an additional withholding for the Additional Medicare Tax at a rate of 0.9% on taxable Medicare wages over $200,000. The Medicare tax is a flat tax rate of 1.45% on your taxable Medicare wages under $200,000. This is the total amount of Medicare tax withheld from your paycheck. Medicare wages are reduced by pre-tax deductions such as health/dental/vision insurance, parking and flexible spending accounts but, not reduced by contributions to retirement or tax deferred savings plans (403(b) or 457). There is no maximum wage base for Medicare. This is the total amount of wages subject to Medicare tax. Wages above the Social Security wage base are not subject to the Social Security tax. The Social Security tax is a flat tax rate of 6.2% on your Social Security taxable income, up to the maximum Social Security wage base for the year. This is the total amount of Social Security taxes withheld from your paycheck. There is an annual maximum for Social Security taxable wages.
Social Security wages are reduced by pre-tax deductions such as health/dental/vision insurance, parking and flexible spending accounts but, not reduced by contributions to retirement or tax deferred savings plans (403(b) or 457). This is the total income subject to Social Security tax. This is the total amount withheld from your paycheck for federal income taxes. The amount in Box 1 will generally be the YTD “Fed Taxable Gross” shown on your final paycheck for the calendar year.
Box 1 does not include pre-tax deductions such as health/dental/vision insurance, parking, flexible spending accounts, retirement and tax deferred savings plans (403(b) or 457). This figure includes your regular wages, bonuses, and any taxable fringe benefits, awards, gifts, taxable moving expenses, as well as the taxable value of group term life insurance in excess of $50,000. This is your total taxable wages for federal income tax purposes.
To have a better understanding of the breakdown of your W-2 form, here is an explanation of the contents of the various boxes as follows:
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