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FICA Taxes › Severance Agreements

Federal Insurance Contribution Act (FICA) Taxes are United States federal payroll taxes levied to fund the Social Security and Medicare system. FICA Taxes burdens are divided between employers and employees and... more +
Federal Insurance Contribution Act (FICA) Taxes are United States federal payroll taxes levied to fund the Social Security and Medicare system. FICA Taxes burdens are divided between employers and employees and are currently set at 12.4% for Social Security and 2.9% for Medicare. less -
Flaster Greenberg PC

Tax Pitfalls To Avoid In Employment Litigation Settlements

Flaster Greenberg PC on

By all measures, 2021 was a banner year for hiring, but 2022 and 2023 have been the opposite. According to one media source, more than 121,000 jobs in the technology sector alone — think Google LLC, Amazon.com Inc.,...more

Foley & Lardner LLP

How Do I Report Non-Qualified Plan or Severance Payments to a Former Employee? Hint: You Should Probably Use a W-2, Not a 1099!

Foley & Lardner LLP on

Employers commonly make payments to former employees for a number of reasons. Two of the more routine payments are those from a non-qualified deferred compensation plan (such as payments from a supplemental executive...more

Skadden, Arps, Slate, Meagher & Flom LLP

Employment Flash (June 2014)

Skadden, Arps, Slate, Meagher & Flom LLP on

In This Issue: - NLRB Recess Appointments Unconstitutional - SEC Brings First-Ever Employment Retaliation Claim - EEOC Challenges Employer Severance Agreements - New York State Transportation Industry...more

McNees Wallace & Nurick LLC

Employment Alert

McNees Wallace & Nurick LLC on

In This Issue: EEOC's Latest Target - Severance Agreements; Pennsylvania's Unemployment Compensation Law May Require Employers to Provide Response to Unemployment Information Requests; and Supreme Court Clarifies that...more

Franczek P.C.

Monthly Benefits Update

Franczek P.C. on

As expected, the Department of the Treasury and the IRS (the “Agencies”) finalized the employer information reporting requirements under the Affordable Care Act (the “ACA”) earlier this month. The final rules, which are...more

Sheppard Mullin Richter & Hampton LLP

Severance Payments are Taxable under FICA

Sheppard Mullin Richter & Hampton LLP on

On Tuesday, March 25, 2014, the U.S. Supreme Court ruled in favor of the Internal Revenue Service in a dispute over the payroll tax treatment of certain types of severance compensation....more

Ervin Cohen & Jessup LLP

Severance Pay As Wages: Business As Usual

Ervin Cohen & Jessup LLP on

Confirming what most employers have long assumed to be true, this week the U.S. Supreme Court held that severance payments made to terminated employees are “wages” subject to the Federal Insurance Contributions Act (FICA) tax...more

Ballard Spahr LLP

Supreme Court Rules That Severance Payments Are Subject to FICA Taxes

Ballard Spahr LLP on

The U.S. Supreme Court has unanimously held that payments of supplemental unemployment benefits (SUB payments) are taxable wages subject to FICA tax withholding. The Court’s decision in United States v. Quality Stores, Inc.,...more

Dechert LLP

Is There Quality to the Argument That Severance Payments Are Not Taxable "Wages"? – Supreme Court Holds That Severance Payments...

Dechert LLP on

Earlier this week, on March 25, 2014, the U.S. Supreme Court handed down a highly publicized decision in the case of United States v. Quality Stores. In Quality Stores, the Court unanimously held that the severance payments...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

The Advantages of Offering Supplemental Unemployment Benefits Instead of Severance, Part I: FICA Taxes and More

Ogletree, Deakins, Nash, Smoak & Stewart,... on

According to the Internal Revenue Service (IRS), severance is subject to Federal Insurance Contribution Act (FICA) tax and certain supplemental unemployment benefits are not....more

Snell & Wilmer

Sixth Circuit Holds that Severance Payments Are Not Subject to FICA Taxes

Snell & Wilmer on

In United States v. Quality Stores, Inc., et al., the United States Court of Appeals for the Sixth Circuit recently held that severance payments qualified as supplemental unemployment compensation benefit (SUB) payments and...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

Government Challenges Sixth Circuit Decision in Quality Stores, Inc.

Ogletree, Deakins, Nash, Smoak & Stewart,... on

On October 18, 2012, the U.S. Department of Justice filed a petition for rehearing en banc in the Sixth Circuit Court of Appeals in United States v. Quality Stores, Inc., No. 10-1563 (September 7, 2012), asking the full court...more

Dickinson Wright

Sixth Circuit Nixes FICA Tax on Severance Pay

Dickinson Wright on

The U.S. Court of Appeals for the Sixth Circuit has affirmed a Michigan Bankruptcy Court and approved a taxpayer’s request for a refund of FICA taxes paid on behalf of former employees. Quality Stores et al....more

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