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FAQ
  Office of Financial Mgnt. - State Employee Payroll
If social security and Medicare taxable wages are calculated the same, why are the amounts in boxes 3 and 5 on my W-2 different?
 
Answer:
The amount in W-2 box 3 represents "Social Security Wages." The amount in box 5 is "Medicare Wages." There is no maximum amount for Medicare Wages. However, there is a calendar year maximum for an employee's "Social Security Wages." Once that maximum is reached, social security taxes no longer apply for that calendar year. The yearly maximum for social security changes each year:

2005 - $90,000
2006 - $94,200
2007 - $97,500
2008 - $102,000
2009 - $106,800

In addition, some employees are exempt from social security but not Medicare, and that would therefore result in social security and Medicare amounts not being equal.

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