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FICA Taxes › Unemployment Benefits

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 -
Morgan Lewis

Supplemental Unemployment Benefit Plans Offer Tax Advantages to Employers Seeking to Support Laid-Off Workers

Morgan Lewis on

Employers considering layoffs in the face of the coronavirus (COVID-19) crisis have additional opportunities to support furloughed workers, aside from options offered by the CARES Act. ...more

McGuireWoods LLP

IRS Informally Rules on Taxability of Short-Week Supplemental Unemployment Benefits

McGuireWoods LLP on

In Chief Counsel Advice 201634023, released Aug. 19, 2016, the IRS Office of Chief Counsel expressed its informal view (in the form of an email to an IRS employee) that “short-week” supplemental unemployment benefits (SUB)...more

Troutman Pepper

New Independent Contractor Misclassification Study Is Belied By Government Report and Disregards the Legitimate Use of Independent...

Troutman Pepper on

The Economic Policy Institute, a respected nonprofit, nonpartisan think tank, has just released a working paper authored by a respected professor who co-authored a number of early academic studies detailing independent...more

Holland & Knight LLP

Religious Institutions Update - Lex Est Sanctio Sancta

Holland & Knight LLP on

"Church plans" are pension plans (including defined benefit or defined contribution plans) exempt (without an irrevocable election) from many of the legal requirements of the Employee Retirement Income Security Act (ERISA)...more

Morgan Lewis

U.S. Supreme Court’s Severance Ruling Impacts Future Unemployment Benefits

Morgan Lewis on

The decision in Quality Stores not only kills FICA tax refunds for millions of unemployed workers, but it also requires proactive employer actions to maximize future employer and state unemployment benefit payments to...more

Stinson - Benefits Notes Blog

IRS Wins One At Supreme Court: Severance Pay Is Subject To FICA Tax

Stinson - Benefits Notes Blog on

I blogged about the Quality Stores decision which at the district court and court of appeals levels held that certain severance payments were not subject to FICA (Social Security) taxes. The IRS had challenged the employer in...more

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

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

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

In part one of this two-part series, “The Advantages of Offering Supplemental Unemployment Benefits Instead of Severance, Part I: FICA Taxes and More,” I reviewed the advantages of offering supplemental unemployment benefits...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

Troutman Pepper

Federal Appeals Court Holds That Supplemental Unemployment Compensation Benefits Are Not ‘Wages’ Subject To FICA Taxation,...

Troutman Pepper on

In an important recent decision, United States v. Quality Stores, Inc., et al., Case No. 01-1563, 2012 U.S. App. LEXIS 18820 (6th Cir. Sept. 7, 2012), the U.S. Court of Appeals for the Sixth Circuit held that supplemental...more

Polsinelli

Court Holds Severance Payments Not Subject To FICA Taxes; Refund Claims Should Be Filed Soon

Polsinelli on

In its recent decision, the United States Court of Appeals for the Sixth Circuit in U.S. v. Quality Stores, Inc., No. 10-1563 (6th Cir., 9/7/2012) held that certain severance payments made to former employees were not subject...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

Foley & Lardner LLP

FICA Taxes on Certain Severance Pay May Be Refundable

Foley & Lardner LLP on

The IRS may owe FICA tax refunds on severance payments made by employers to laid-off or terminated employees as part of reductions in workforce. Every employer that paid severance to laid-off employees as part of a reduction...more

Ballard Spahr LLP

Employers Should Evaluate Refund Opportunities Following Sixth Circuit Ruling on FICA Taxes and Severance Payments

Ballard Spahr LLP on

In United States v. Quality Stores, Inc., the Sixth Circuit held that payments of supplemental unemployment benefits (SUB payments) are not taxable wages subject to FICA tax withholding. Although the issue is not finally...more

McDermott Will & Emery

Quality Stores Decision Could Lead to Significant Refunds of FICA Tax

McDermott Will & Emery on

The U.S. Court of Appeals for the Sixth Circuit recently held that certain dismissal payments were Supplemental Unemployment Compensation Benefits (SUB) exempt from FICA taxes—a clear split with the U.S. Court of Appeals for...more

Stinson - Benefits Notes Blog

Possible FICA Tax Savings on Severance Pay

Stinson - Benefits Notes Blog on

A recent Sixth Circuit Court of Appeals decision concluded that severance pay provided to employees as a result of layoff or discontinuance of a plant, operations or other similar condition is exempt from FICA taxes....more

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