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Compare how Medicare taxes are paid by individuals who are employees to those who are self-employed.(1 point)

Responses

Employees do not pay the Medicare tax and the employer pays for both halves of the tax (2.9%). Self-employed individuals pay for both halves of the tax (2.9%).
Employees do not pay the Medicare tax and the employer pays for both halves of the tax (2.9%). Self-employed individuals pay for both halves of the tax (2.9%).

Employees pay for both halves of the tax (2.9%) and the employer does not pay the Medicare tax. Self-employed individuals do not pay Medicare tax.
Employees pay for both halves of the tax (2.9%) and the employer does not pay the Medicare tax. Self-employed individuals do not pay Medicare tax.

Employees pay half (1.45%) of the Medicare tax while the employer pays the other half. Self-employed individuals pay for both halves of the tax (2.9%).
Employees pay half (1.45%) of the Medicare tax while the employer pays the other half. Self-employed individuals pay for both halves of the tax (2.9%).

Employees pay half (1.45%) of the Medicare tax while the employer pays the other half. Self-employed individuals pay half (1.45%) of the Medicare tax.
Employees pay half (1.45%) of the Medicare tax while the employer pays the other half. Self-employed individuals pay half (1.45%) of the Medicare tax.

1 answer

The correct comparison of how Medicare taxes are paid by employees versus self-employed individuals is:

Employees pay half (1.45%) of the Medicare tax while the employer pays the other half. Self-employed individuals pay for both halves of the tax (2.9%).

To elaborate, employees have a Medicare tax rate of 1.45% withheld from their paychecks, and their employer matches that with another 1.45%. In contrast, self-employed individuals must pay the entire 2.9% Medicare tax themselves, as they do not have an employer to share the cost.