CM: 2.4 Social Security and Medicare Taxes

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What is Social Security Tax?

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A tax levied on earnings to fund the Social Security program, which provides benefits for retirees, disabled individuals, and survivors of deceased workers.

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What is the standard rate for Social Security Tax?

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6.2% of gross income.

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CCSS.7.RP.A.3

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How is Medicare Tax calculated?

Back

Medicare Tax is calculated as 1.45% of gross income.

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CCSS.7.RP.A.3

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If gross income is $24,388, what is the Social Security Tax due?

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$1,512

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CCSS.7.RP.A.3

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If gross income is $500, how much Social Security tax is withheld?

Back

$31

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CCSS.7.RP.A.3

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What percent of your earnings goes to Medicare?

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1.45% of gross income.

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CCSS.6.RP.A.3C

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If gross income is $87,425, what is the Medicare Tax due?

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$1,268

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CCSS.7.RP.A.3

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If gross income is $24,388, what is the Medicare Tax due?

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$354

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CCSS.7.RP.A.3

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What is the purpose of Social Security?

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To provide financial support to individuals during retirement, disability, or after the death of a family wage earner.

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What is the difference between Social Security Tax and Medicare Tax?

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Social Security Tax funds retirement and disability benefits, while Medicare Tax funds health insurance for individuals aged 65 and older.