S.Amdt. 4411

The amendment, titled the Medicare and Social Security Fair Share Act, aims to change how payroll and investment taxes are collected to increase funding for trust funds.

Key Changes and Additions:

• Social Security Payroll Taxes: It raises the wage base for Social Security taxes to $400,000.

• Hospital Insurance Tax: It adds a new 1.2 percent tax on wages and self-employment income for very high-income taxpayers. The thresholds for this tax are $500,000 for joint returns, $250,000 for married taxpayers filing separately, and $400,000 for others.

• Unearned Income Taxes: It modifies the tax on net investment income for high-income individuals. This includes adding an additional rate bracket of 13.6 percent for those exceeding specific high-income thresholds and increasing the tax rate for trusts and estates to 17.4 percent.

• Trust Fund Transfers: The amendment directs specific percentages of the taxes collected under section 1411 of the Internal Revenue Code of 1986 to the following funds for taxable years beginning after December 31, 2025:

  • 71.3 percent to the Federal old-age and survivors trust fund.
  • 10.3 percent to the Federal disability insurance trust fund.
  • 28.7 percent to the Federal hospital insurance trust fund.