The “Med EE” line on your paycheck is the employee share of Medicare tax, withheld at 1.45% of your gross wages every pay period under the Federal Insurance Contributions Act.1Office of the Law Revision Counsel. 26 USC Ch. 21 Federal Insurance Contributions Act “EE” is standard payroll shorthand for employee, distinguishing your half from the matching share your employer pays separately. Unlike Social Security tax, Medicare tax has no annual wage cap, so it comes out of every dollar you earn. If your wages from a single job pass $200,000 in a calendar year, an extra 0.9% starts coming out on top of the 1.45%.
How the Amount Is Calculated
The math is simple. Multiply your Medicare-taxable wages for the pay period by 0.0145. On a $3,000 biweekly check, that’s $43.50. That figure appears on your stub as “Med EE,” “Medicare,” “EE Med,” or a close variant.
Nothing you put on your Form W-4 changes this number. The W-4 controls federal income tax withholding only; FICA taxes are a flat percentage of wages regardless of allowances or extra withholding you request.2Internal Revenue Service. About Form W-4, Employee’s Withholding Certificate If the Med EE line looks off, it’s a wage-base issue, not a W-4 issue.
Why Your Medicare Wages Can Differ From Your Taxable Wages
Not every dollar of gross pay is subject to Medicare tax, and not every pre-tax deduction reduces it. This is where paycheck confusion usually starts.
Deductions run through a Section 125 cafeteria plan, including health insurance premiums, health FSA contributions, and dependent care FSA contributions, are generally exempt from FICA. Those amounts come out before Medicare tax is calculated.3Internal Revenue Service. FAQs for Government Entities Regarding Cafeteria Plans Contribute $200 a paycheck toward employer health coverage through a cafeteria plan and Med EE is calculated on gross pay minus that $200.
Traditional 401(k) contributions do not work the same way. Pre-tax 401(k) deferrals reduce your federal income tax but not your Medicare wages. You owe 1.45% on every dollar you defer.4Internal Revenue Service. Retirement Plan FAQs Regarding Contributions That’s the main reason Box 5 (Medicare Wages) on your year-end W-2 often ends up higher than Box 1 (federal taxable wages).
The Extra 0.9% for High Earners
Once your wages from a single employer cross $200,000 in a calendar year, that employer is required to start withholding an additional 0.9% Medicare tax on wages above that point.5Internal Revenue Service. Questions and Answers for the Additional Medicare Tax Your total Med EE rate on the excess climbs to 2.35%. This is called the Additional Medicare Tax and has been in place since 2013.
The catch is that the $200,000 employer trigger doesn’t match the actual thresholds in the law, which depend on your filing status:
- Single or head of household: $200,000
- Married filing jointly: $250,000 in combined wages and self-employment income
- Married filing separately: $125,000
These figures are set by statute and are not indexed for inflation.6Office of the Law Revision Counsel. 26 USC Ch. 21 Federal Insurance Contributions Act – Section 3101
Two mismatches show up often. A married couple filing jointly whose household wages together exceed $250,000, but where neither spouse individually clears $200,000, will owe the additional tax at filing even though nothing extra was withheld. In the opposite direction, a single earner with $220,000 in wages will have the 0.9% withheld on $20,000, but a jointly filing spouse with no income means the household is well under $250,000, and the over-withholding comes back at filing.
You settle up either way on Form 8959, which attaches to your Form 1040 and reconciles what your employer withheld against what you actually owe based on filing status and total income.7Internal Revenue Service. About Form 8959, Additional Medicare Tax If you know you’ll owe a meaningful amount at year end, either send it through quarterly estimated taxes or add extra income tax withholding on your W-4 during the year to avoid an underpayment penalty.8Internal Revenue Service. Topic No. 560, Additional Medicare Tax
What the Tax Buys You
Med EE withholding funds the Medicare Hospital Insurance Trust Fund, which pays for Medicare Part A. Part A covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health services for roughly 67 million Americans.
Paying in also builds your own eligibility. Once you or your spouse accumulate 40 calendar quarters of covered work, about 10 years, you qualify for premium-free Part A at 65. Fall short and you can still enroll, but you’ll pay a monthly premium.
Your employer pays a matching 1.45%, bringing the total contribution on your wages to 2.9%.9Office of the Law Revision Counsel. 26 USC 3111 – Rate of Tax The match doesn’t come out of your check and won’t appear on your stub. The employer match applies only to the standard 1.45%; there is no employer match on the 0.9% Additional Medicare Tax.10Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates
Who Doesn’t Pay It
Almost every wage earner pays Medicare tax. The exemptions are narrow:
- Students enrolled and regularly attending classes at a college or university who work for that same institution in a role incidental to their studies. The exemption doesn’t cover professional employees or postdoctoral researchers.11Internal Revenue Service. Student FICA Exception
- Members of a recognized religious sect with established teachings against accepting insurance benefits, who apply using IRS Form 4029. The sect must have existed continuously since December 31, 1950.
- State and local government workers hired before April 1, 1986, who have been continuously employed since and participate in a qualifying public retirement system. Anyone hired after March 31, 1986, is covered.12Internal Revenue Service. State and Local Government Employees Social Security and Medicare Coverage
If Med EE is on your stub, one of these almost certainly does not apply to you.
Checking Your Stub and W-2 for Errors
On any single stub, Med EE should equal your Medicare-taxable wages for the period times 0.0145. If it looks high, your year-to-date wages may have crossed $200,000 and the extra 0.9% kicked in.
At year end, Box 5 of your W-2 shows total Medicare wages and Box 6 shows total Medicare tax withheld, including any Additional Medicare Tax. Box 5 will often exceed Box 1 because of 401(k) deferrals and similar pre-tax items that reduce income tax but not Medicare tax. Box 5 can also exceed Box 3 (Social Security wages), because Social Security wages are capped at $184,500 for 2026 while Medicare wages are not.10Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates13Internal Revenue Service. General Instructions for Forms W-2 and W-3 (2026)
Before you file, compare the cumulative Medicare withholding on your last stub of the year to Box 6. If they don’t match, ask your employer’s payroll department to reconcile it. A wrong Box 6 either costs you money at filing or shows up later as an underpayment.