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IRS proposes long-awaited rules (REG-130074-11) and a set of FAQs on the new Medicare tax set to be imposed on the earnings of higher-income taxpayers after Dec. 31. The Affordable Care Act requires employers to withhold the new tax from employees earning more than $200,000 in a calendar year, although the income threshold at which the tax will apply varies by the type of taxpayer. IRS says the rules offer guidance for employers and individuals on how to implement the tax. They address withholding the tax from wages, the process for employers to adjust underpayments and overpayments, and the process for employees to seek overpayment refunds.
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