This article discusses who qualifies to take the credit, how to make the election, the calculation and allocation of the credit, and how to report it.
The Social Security Administration said that the amount of wages subject to the old age, survivors, and disability insurance (OASDI) tax for 2019 will be $132,900, increased from 2018’s maximum of $128,400.
A recent Tax Court case highlights pitfalls frequently encountered by small businesses that engage in related-party transactions without appropriate planning.
The Social Security Administration said that the maximum amount of wages subject to the 6.2% Social Security tax in 2018 will rise a little more than 1%, after a much larger increase last year.
Tax Court held that rent payments to chicken farmers by their S corporation’s poultry farming operations qualified for the exclusion for rental payments from self-employment income.
The SSA said that the maximum amount of wages subject to the 6.2% Social Security tax in 2018 will rise a little more than 1%, after a much larger increase last year.
Income earned by financial adviser was his, not the income of his wholly owned S corporation, and was therefore subject to self-employment tax.
The wife of a partial owner of a corporation that owned a restaurant signed payroll checks yet was determined to be not a responsible person for purposes of the Sec. 6672 trust fund penalty.
The SSA announced that the maximum amount of earnings subject to the Social Security tax will increase by more than 7% in 2017, after remaining flat in 2016.
The meaning of the terms “amend” or “supplement” must be determined in light of the full text of a social security totalization agreement and the shared expectations of the contracting governments.
A taxpayer’s proceeds from sales of scrap steel over a seven-year period were not considered self-employment income.
The Eleventh Circuit Court of Appeals held that payments a retired Mary Kay sales consultant received from the cosmetics company were subject to self-employment taxes because they were payments of deferred compensation.
Employers in the for-profit, tax-exempt, and public sectors may overlook a number of issues involving the application of the employment tax rules.
IRS Disagrees With Tax Court on Ability to Designate Employment Tax Payments as Income Tax Withholding
The IRS announced in that it will not follow a Tax Court holding that an employer may designate payments of its employment taxes to the income taxes of specific employees.
The definition of wages for purposes of income tax withholding and for the Federal Insurance Contributions Act has often been a point of contention. The Supreme Court recently reversed an appellate decision and held that severance payments to employees who were involuntarily terminated were taxable wages for FICA purposes.
In tax practice, CPAs occasionally encounter self-employed clients who have difficulty keeping up with their quarterly estimated tax payments. The problem of making adequate estimated tax payments is particularly difficult for the self-employed because they generally do not have taxes withheld and remitted to the government, as do most employees with wages reported on Form W-2.
The Supreme Court, reversing a decision of the Sixth Circuit, held that severance payments to terminated employees are subject to FICA withholding.
The Tax Court in Blodgett, T.C. Memo. 2012-298, provided useful information to determine corporate directors' income classification when the initial answer may be unclear.
The Supreme Court held in an 8–0 decision that severance payments to terminated employees are taxable wages for FICA tax purposes.
Regulations contain guidance for employers and individuals on the implementation of the tax, including the requirement to file a return reporting the tax, the process for employers to make adjustments of underpayments and overpayments of the tax, and the processes for employers and employees to file claims for refund for an overpayment of the tax.