What is the employer's maximum contribution for Medicare tax on employee wages?

The employer's maximum contribution for Medicare tax on employee wages is indeed 1.45%. Medicare tax is applied to all employee wages without a cap, meaning that it is calculated on each dollar earned. Both employers and employees contribute equally at this rate. Additionally, high-income earners may be subject to an additional Medicare tax of 0.9%, but this only applies to wages exceeding certain thresholds and is solely the responsibility of the employee, not the employer.

Understanding the difference in percentages is crucial for payroll professionals. While Social Security tax, which has a separate rate of 6.2%, does have a wage base limit, the Medicare tax does not have any cap on the earnings it applies to, which is why the correct contribution rate is 1.45%. Therefore, the chosen answer reflects the standard employer contribution rate specific to Medicare.