What Are Medicare Wages?

What Are Medicare Wages?

The wages for each quarter are determined by multiplying the number of hours worked by the rate of pay for the type of work performed. For example, a CNA works 36 hours a week at $15 per hour. That quarter's wages are $630 ($15 x 36). The same CNA worked 36 hours a week at $10 per hour. That quarter's wages would be $360 ($10 x 36). Using this method, an employer can determine the medicare wages for each employee for any given quarter simply by multiplying the hours worked by the hourly rate of pay.

What are tips?

Generally, tips are considered by the IRS to be income, to the extent that they are reported to the employer by the employee. The employer deducts the federal income tax from the reported tip amount and withholds the employee FICA taxes. The employee's share of the FICA taxes is refunded to the employee on that tax return.

What if I am paid with a combination of cash and check?

Tips are included in the FICA computation. If the cash wage is $2.50 per hour, then the FICA rate is also $2.50 per hour.

What kind of information will I need from my employer to file my taxes?

You will need the total wages you were paid each quarter, as well as the hourly rate of pay. If you received tips, you will need to provide the amount of tips you were paid for each quarter.

If you were paid cash and check, you will need to allow us enough time to receive your information from your employer.

If you were paid in tips, you will need to provide the amount of tips you were paid for each quarter.

What if I have been getting my income withheld from my pay and I am no longer working?

If you are no longer working for a company, you will need to contact them and ask for a W-2 for the quarter(s) during which you worked and to whom you made your last payment. You can also contact the Taxpayer Service Center.

What if I get a W-2 with incorrect amounts?

If your W-2 does not agree with the information you reported on your Illinois return, you must contact the employer. You should advise the employer of the difference on the W-2 and ask them to send you a corrected W-2. You should also contact the Taxpayer Service Center.

Do I have to file a return if I am not required to file?

Yes. If you have taxable income and you do not file, the law requires the Department of Revenue to estimate your tax and penalties on an estimated return.

What are my options if I want to pay my tax liability in installments?

If you have a tax liability that cannot be paid in full, you may want to consider an installment agreement.

If you are required to make monthly estimated payments, you may be eligible to apply for an installment agreement. To qualify for an installment agreement, you must be current on your estimated tax payments and have a valid reason for being unable to pay your tax liability in full.

To qualify for an installment agreement, you must complete Form IL-1040-V, Payment Voucher, and send it to the Department of Revenue along with a completed Form IL-1041, Installment Agreement.

What happens if I do not pay the full amount of my tax liability?

If you do not pay the full amount, penalties and interest will be added to your tax.

What is a penalty?

A penalty is an additional amount that is assessed by the Department for not meeting certain tax obligations.

What is interest?

Interest is an additional amount that is added to the tax you owe, and is assessed by the Department for not paying the full amount on time.

What is the penalty for an underpayment?

The penalty for an underpayment is 5% of the underpayment, but not more than 25% of the tax due.

What is the penalty for an overpayment?

The penalty for an overpayment is 5% per month, or portion of a month, on the amount of overpayment for the period that the overpayment was due.

What is the penalty for failure to file a return?

The penalty for failure to file is 5% of the tax due.

What is the penalty for failure to include a return?

The penalty for failure to include a return is 5% of the tax due.

What if I do not pay the full amount due for a return that I owe?

The penalty for failure to pay the full amount of tax due on a return that you owe is 10% of the tax due, plus 5% of the tax due for each month or part of a month the amount remains unpaid.

What is the penalty for failure to pay the full amount of tax due?

The penalty for failure to pay the full amount of tax due is 10% of the tax due, plus 5% of the tax due for each month or part of a month the amount remains unpaid.

What is the penalty for failure to file or pay on a timely basis?

The penalty for failure to file a return is 10% of the tax due, plus 5% of the tax due for each month or part of a month the amount remains unpaid.

What is the penalty for failure to file a correct return?

The penalty for failure to file a correct return is $250 for each person who does not file a correct return.

What is the penalty for failure to make a timely estimated tax payment?

The penalty for

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