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For example, younger persons who are still working probably arenât on Medicare and are still paying into the system by a rate of 6.2% of their annual earnings. Elderly persons on Medicare can use the IRS tax deduction to reduce their tax burden by claiming costs associated with Medicare payments.
3. Medicare â This is a deduction for Medicare insurance and is 1.45% of taxable wages for employees. It may be combined with FICA or it may be listed as Med or something similar. 4. State â If your state has an income tax, it will be listed as SIT, St TX, state or maybe even the name of your state. 5.