The issue in Quality Stores involved whether SUB payments are wages for FICA purposes under the Internal Revenue Code (the "Code" ). The FICA provisions of the Code do not specifically mention or even make reference to SUB payments. But another portion of the Code says that for purposes of income tax, SUB payments are taxed as ifthey were a payment of wages. 26 U.S.C. 3402(o)(1). The taxpayers argued, and the Sixth Circuit agreed, that the "as if" language is critical. Without the "as if" language, the SUB payments would not be considered wages for income tax purposes. Similarly, because there is no "as if" language in the FICA portion of the Code, they should not be considered wages for FICA purposes. The Sixth Circuit ordered a refund of the FICA payments to the employer and the former employee. … [Read more...] about Potential Opportunity for Refund of FICA Taxes Paid on Supplemental Unemployment Benefits Payments
Federal benefit payment
The News & Observer of Raleigh reports a federal indictment accused 61-year-old Elizabeth Hayes Cox of stealing more than $68,000 in Social Security money and another $44,000 from the Department of Veterans Affairs between 2000 and 2017 on behalf of a fictitious son. … [Read more...] about Prosecutors: Woman collected federal benefits for fake son
On May 9, 2014, the Internal Revenue Service finalized regulations that govern the tax treatment of payments made by retirement plans to pay accident or health insurance premiums. Under the final regulations, accident or health insurance premium payments by qualified defined contribution plans are taxable distributions to the participant unless those payments are used to pay premiums for disability insurance that replace retirement plan contributions for disabled employees. The regulations apply for tax years beginning January 1, 2015, although taxpayers may elect to apply them to earlier years. However, amounts used to pay premiums for disability insurance that will continue retirement plan contributions on behalf of disabled employees are not taxable distributions if they meet certain conditions. … [Read more...] about Final IRS Regulations Allow Retirement Plan Payments for Accident, Health and Disability Insurance
This was recently addressed in Olson v. Dept. of Labor & Industries, 161 Wn. App. 443 (2011), in which a surviving spouse sought declaratory judgment that the Department of Labor and Industries (“L&I”) was responsible in conjunction with the federal government for death benefits payable upon her husband’s death (which was caused by prolonged exposure to asbestos). … [Read more...] about Survivor Benefits Under the Washington Industrial Insurance Act–Who Pays?
In addition, employers may have a separate deadline for situations in which the IRS has issued a notice of claim disallowance for FICA refund claims. In such cases, an employer must either: (i) bring suit to contest the disallowance within two years after the issuance of the notice or (ii) obtain an extension of the time to file such a suit with the IRS. This process can be initiated by filing IRS Form 907, Agreement to Extend the Time to Bring Suit. However, because the IRS is not required to grant an extension requested pursuant to an employer filing Form 907, employers may also wish to file suit. … [Read more...] about Deadline Looms for Quality Stores FICA (Federal Insurance Contributions Act) Refund Claims for Severance Payments