Fundamental Payroll Certification (FPC) Practice Exam

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What is the payroll tax contribution percentage for Medicare that employers pay?

  1. 1.45%

  2. 1.75%

  3. 2.35%

  4. 3.0%

The correct answer is: 1.45%

The correct percentage for the payroll tax contribution that employers pay for Medicare is 1.45%. This rate is established by federal law and applies to all covered wages for employees, irrespective of the amount. Employers are required to match this contribution, meaning they also pay 1.45% of each employee's earnings toward Medicare. Additionally, it is important to note that there is a supplementary Medicare tax that becomes applicable for high-income earners, which is an additional 0.9% withheld from employees earning above a specific threshold. However, the standard employer contribution remains at 1.45% for all employees without regard for their income level. The rates listed in the other choices do not correspond to the established percentages for employer contributions to Medicare, which further clarifies why the 1.45% figure is the correct answer.