Who Pays Medicare Tax and How

Medicare tax funds Part A hospital insurance, applying to nearly all U.S. workers, including self-employed.
The standard Medicare tax rate is 2.9%, split 1.45% each between employers and employees.
All earned income is taxable, with high earners paying 0.9% additional Medicare tax above thresholds.
Net investment income above thresholds is taxed 3.8%, affecting dividends, interest, capital gains, and rentals.
Collected taxes support hospital, hospice, and nursing care, but the trust fund may face shortfalls by 2031.