Answer :
To determine the employee's yearly contribution to the U.S. Medicare tax on a salary of [tex]$40,000, we'll follow these steps:
1. Understand the Medicare Tax Rate: According to the table, the employee's responsibility for the Medicare tax is 1.45%.
2. Convert the Percentage to Decimal Form: To perform the calculation, we'll convert the percentage to a decimal. The Medicare tax rate of 1.45% is equivalent to 0.0145 in decimal form.
3. Calculate the Medicare Contribution: The Medicare tax contribution can be found by multiplying the employee's salary by the Medicare tax rate in decimal form.
\[
\text{Medicare Contribution} = \text{Salary} \times \text{Medicare Tax Rate}
\]
4. Substitute the Known Values: Here, the salary is $[/tex]40,000, and the Medicare tax rate is 0.0145.
[tex]\[ \text{Medicare Contribution} = 40,000 \times 0.0145 \][/tex]
5. Compute the Value: Multiplying 40,000 by 0.0145 gives us the Medicare tax contribution.
Therefore, the employee's yearly contribution to the U.S. Medicare tax on a salary of [tex]$40,000 is $[/tex]580.0.
[tex]\[ \text{Medicare Contribution} = 40,000 \times 0.0145 \][/tex]
5. Compute the Value: Multiplying 40,000 by 0.0145 gives us the Medicare tax contribution.
Therefore, the employee's yearly contribution to the U.S. Medicare tax on a salary of [tex]$40,000 is $[/tex]580.0.
