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Question

Find the Social Security tax and the Medicare tax for the amount of gross earnings. Assume a 6.2% FICA rate and a 1.45% Medicare tax rate.

$463.24 ________ ________

Solution

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Answered 2 years ago
Answered 2 years ago
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First, lets see the formula to calculate social security tax and Medicare tax:

Social security tax=Gross earnings×Rate of FICAMedicare tax=Gross earnings×Rate of Medicare\begin{align*} \text{Social security tax} &= \text{Gross earnings} \times \text{Rate of FICA}\\[10pt] \text{Medicare tax} &= \text{Gross earnings} \times \text{Rate of Medicare} \end{align*}

Gross earnings = $463.24

Rate of FICA = 0.062

Rate of medicare = 0.0145

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