Instructions for Filling Out Form 8959

This document offers a comprehensive guide on completing Form 8959 for calculating the Additional Medicare Tax owed by individuals in the United States for the year 2023. It covers eligibility, amounts subject to the tax, and calculation methods, along with a step-by-step guide for filling out the form.

In this article, we'll provide essential information on Form 8959 and a step-by-step guide on how to fill it out accurately and efficiently.

What is Form 8959?

Form 8959 is a tax document used to calculate and report the Additional Medicare Tax owed by taxpayers in the United States. This tax applies to Medicare wages, Railroad Retirement Tax Act (RRTA) compensation, and self-employment income above a certain threshold. The form consists of sections for calculating Additional Medicare Tax on various income types and a section for withholding reconciliation. The purpose of Form 8959 is to ensure that individuals accurately report and pay the Additional Medicare Tax they owe based on their income levels.

Who Must File Form 8959?

Individuals need to file Form 8959 if they meet one or more of the following criteria: their Medicare wages and tips on any single Form W-2 (box 5) exceed $200,000; their Railroad Retirement Tax Act (RRTA) compensation on any single Form W-2 (box 14) surpasses $200,000; their total Medicare wages and tips plus self-employment income (including their spouse's income if married filing jointly) are greater than the threshold amount for their filing status; or their total RRTA compensation and tips (Form W-2, box 14) (including their spouse's compensation and tips if married filing jointly) exceed the threshold amount for their filing status.

Form 8959 Tax Filing Deadlines and Due Dates

• Form 8959 is generally due when individuals file their tax returns.

Form 8959 Late Payment Penalty

Although there’s no specific the late payment penalty amount for Form 8959, it's important to note that penalties may apply for late filing or late payment of taxes in general. To avoid potential penalties, taxpayers should ensure they file their tax returns and pay any taxes owed, including the Additional Medicare Tax, by the due date.

Step-by-Step Instructions for Form 8959

The step-by-step instructions for filling out Form 8959 are as follows:

1. Enter your Medicare wages and tips from box 5 of your Form W-2 on Line 1.
2. Enter unreported tips from line 6 of Form 4137 on Line 2.
3. Enter wages from line 6 of Form 8919 on Line 3.
4. Multiply line 6 by 0.9% (0.009) and enter the result on Line 7.
5. Enter your self-employment income from Schedule SE, Part I, line 6 on Line 8.
6. Multiply line 12 by 0.9% (0.009) and enter the result on Line 13.
7. Enter the total of your RRTA compensation and tips on Line 14.
8. Multiply line 16 by 0.9% (0.009) and enter the result on Line 17.
9. Include the amount from line 18 on the appropriate line of your tax return.
10. Enter the amount of Medicare tax withheld, if any, reported on Form W-2, box 6 on Line 19.
11. Enter the amount of Additional Medicare Tax withheld, if any, reported on Form W-2, box 14 on Line 23.
12. Include the amount from line 24 on the appropriate line of your tax return.
13. Attach your completed Form 8959 to Form 1040, 1040-SR, 1040-NR, or 1040-SS.

How to Submit Form 8959

To submit Form 8959, first fill out the form according to the provided instructions. Next, attach the completed Form 8959 to your tax return. Finally, submit the form and your tax return to the IRS. Ensure that you include your name, social security number, the amount of your Medicare wages and tips, self-employment income, RRTA compensation, any Additional Medicare Tax withheld by your employer, and the total amount of Additional Medicare Tax you owe.

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