Additional Medicare Tax
Tax Relief with Timalyn Bowens
Tax Relief with Timalyn Bowens Additional Medicare Tax Episode 71: In this episode, Timalyn addresses the additional Medicare tax that taxpayers are faced with when they reach they reach a certain income threshold. Before getting into the episode, Timalyn warns taxpayers not to go exempt on their W-4 because the government is shut down. She reminds taxpayers that they will still be responsible for the tax due when they file their taxes in the Spring. What is the additional Medicare Tax? The additional Medicare tax was created to help fund the tax provisions...
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Should I File as Head of Household?
Tax Relief with Timalyn Bowens
Tax Relief with Timalyn Bowens Should I File as Head of Household? Episode 70: In this episode, Timalyn addresses a tax filing fundamental that is often misconstrued and can lead to unnecessary tax debt and penalties. Head of household is a tax filing status for taxpayers who are unmarried but keep up the expenses of a home for a qualifying dependent. Who Qualifies for Head of Household? 3 requirements must be met for a person to claim head of household status. 1 - They were unmarried for the tax year. This is for taxpayers who have never been married, are...
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Government Shutdown ≠ IRS Shutdown
Tax Relief with Timalyn Bowens
Tax Relief with Timalyn Bowens Government Shutdown ≠ IRS Shutdown Episode 69: In this episode, Timalyn deviates from the discussion begun in Episode 64 about the One Big Beautiful Bill Act. Timalyn addresses the government shutdown and how it affects the IRS and, in turn, all taxpayers. Today, she’s explaining what a government shutdown is, how a government shutdown doesn’t give taxpayers in tax debt a get out of jail free card, what to expect from the IRS right now, and how this will likely affect the 2026 filing season. What is a government...
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Charitable Contributions
Tax Relief with Timalyn Bowens
Tax Relief with Timalyn Bowens Charitable Contributions Episode 68: In this episode, Timalyn continues the discussion begun in Episode 64 about the One Big Beautiful Bill Act. Today, she’s explaining the charitable contribution deduction and the changes that have been made to it under the One Big Beautiful Bill Act. What is a charitable contribution? Charitable contributions are money or property that are given to a 501(c)(3) nonprofit organizations, religious organizations, educational institutions, fraternal organizations, public cemetaries, and certain government...
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Senior Deduction 2025
Tax Relief with Timalyn Bowens
Tax Relief with Timalyn Bowens Senior Deduction 2025 Episode 67: In this episode, Timalyn continues the discussion begun in Episode 64 about the One Big Beautiful Bill Act. Timalyn opens up the episode with a reminder of what the One Big Beautiful Bill Act is. There is a video version of this episode! You can watch it here : Today, she’s explaining the enhanced senior deduction for taxpayers who are 65 and older. This deduction will be available for tax years 2025 - 2028. If there is any part of this new tax law that you’d like to hear her cover, please let us...
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Car Loan Interest Deduction
Tax Relief with Timalyn Bowens
Episode 66: In this episode, Timalyn continues the discussion begun in Episode 64 about the One Big Beautiful Bill Act. Timalyn opens up the episode with a reminder of what the One Big Beautiful Bill Act is. Timalyn also warns that this tax year may not be the one where you want to let someone who is not a professional handle your preparation. Today, she’s explaining the car loan interest deduction. If there is any part of this new tax law that you’d like to hear her cover, please let us know. Car Loan Interest Deduction This new deduction is effective for tax years 2025...
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No Tax on Tips
Tax Relief with Timalyn Bowens
Episode 65: In this episode, Timalyn continues the discussion begun in Episode 64 about the One Big Beautiful Bill Act. Today, she’s explaining the no tax on tips deduction. If there is any part of this new tax law that you’d like to hear her cover, please let us know. No Tax on Tips Timalyn jumps right in to let listeners know that tips are still considered taxable income. In order for them to be deducted, they must also be reported to the IRS. The One Big Beautiful Bill Act created a new section in tax law that allows a maximum of $25,000 in qualified tips to be deducted from...
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No Tax on Overtime
Tax Relief with Timalyn Bowens
Episode 64: In this episode, Timalyn breaks down a hot topic from the newly passed One Big Beautiful Bill Act, the No Tax on Overtime Act, and what it really means for working taxpayers starting in 2025. There has been a lot of confusion online suggesting that overtime income is completely tax-free. But is that true? Not exactly. Timalyn explains how the law allows an above-the-line deduction for qualifying overtime income. That means you can deduct a portion of your overtime pay from your taxable income, but it is not completely exempt. She walks you through who qualifies, how much can be...
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What if I Disagree with an Audit?
Tax Relief with Timalyn Bowens
Episode 63: In this episode, Timalyn concludes her series on IRS audits by addressing a critical concern: what to do if you disagree with an audit decision. In the previous two episodes, Timalyn broke down what IRS audits are and why taxpayers may be selected for one. Now, she helps listeners understand the next step—how to respond when they believe the IRS got it wrong. Mistakes happen, whether it’s human error or an automated system glitch. But you don’t have to accept the results without a fight. Timalyn walks through the three potential outcomes of an audit: No Change: You provided...
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Why Am I Being Selected for an Audit?
Tax Relief with Timalyn Bowens
Episode 62: In this episode, Timalyn explains why the IRS selects certain taxpayers for audits and reassures listeners that being chosen does not automatically mean anything is wrong. Following up on last week’s episode, , Timalyn continues her audit series by breaking down how audit selections are made and why it is important not to panic if you receive an IRS notice. Contrary to common fears, receiving an audit notice does not mean jail time or that you did something wrong. Many audits are selected at random or flagged through a computer system that looks for unusual patterns or...
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Additional Medicare Tax
Episode 71: In this episode, Timalyn addresses the additional Medicare tax that taxpayers are faced with when they reach they reach a certain income threshold.
Before getting into the episode, Timalyn warns taxpayers not to go exempt on their W-4 because the government is shut down. She reminds taxpayers that they will still be responsible for the tax due when they file their taxes in the Spring.
What is the additional Medicare Tax?
The additional Medicare tax was created to help fund the tax provisions in the Affordable Care Act. This includes the premium tax credit.
The tax amount is 0.9% of self-employment income, and railroad retirement (RRTA) compensation that exceeds certain income thresholds that are set based on filing status.
The threshold for single and head of household taxpayers is $200,000. It is $125,000 for married taxpayers who file separately, and $250,000 for taxpayers who are married filing jointly.
How is the additional Medicare Tax computed?
Form 8959, Additional Medicare Tax is used to calculate the tax amount. The tax then flows to Schedule 2 of the 1040. The amount over the income threshold is what the taxpayer pays 0.9% on. If the taxpayer is self-employed and has a loss, they will not pay the additional Medicare tax on that amount.
For self-employed taxpayers, it is their responsibility to make payments of the additional Medicare tax with their estimated tax payments. If they have wage income, they can adjust their withholding to account for that.
You can check out America’s Favorite EA YouTube page for a series on how to fill out your W-4 here: Tax Withholding
Employers are responsible for withholding the additional Medicare tax from wages or railroad retirement compensation if they pay the employee more than $200,000 in a calendar year. It does not matter what the filing status of the employee is. The employer does not have an obligation to match the amount that is withheld for the additional Medicare tax.
Expats pay additional Medicare tax too
U.S. citizens who live abroad have to pay the additional Medicare tax if their income exceeds the threshold. They are not exempt, even if they are eligible for the foreign income exclusion. This also applies to nonresident aliens.
Need Tax Help Now?
If you need answers to your tax debt questions, book a consultation with Timalyn via her Bowens Tax Solutions website. Click this link to book a call.
Please consider sharing this episode with your friends and family. There are many people dealing with tax issues, and you may not know about it. This information might be helpful to someone who really needs it.
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Remember, Timalyn Bowens is America’s Favorite EA, and she’s here to fill the tax literacy gap, one taxpayer at a time. Thanks for listening to today’s episode.
For more information about tax relief options or filing your taxes, visit https://www.Bowenstaxsolutions.com/ .
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Disclaimer: This podcast is for informational and educational purposes only. It provides a framework and possible solutions for solving your tax problems, but it is not legally binding. Please consult your tax professional regarding your specific tax situation.