Federal Social Security Act Flashcards
Taxes payable under FUTA
are used to provide unemployment compensation to workers who lose jobs and can’t find replacement
FUTA Taxes
are paid and deductible by employer
When must Employers must pay FUTA
If they paid wages of $1,500 or more during a calendar quarter OR
employed one employee for one day per week for 20 weeks
Taxes payable under FUTA
is a fixed percentage of only the first $7,000 of wages to each employee
Unemployment compensation
is intended for workers who lose their job through NO fault of their own and can’t find a replacement
Refusing to accept replacement work
disqualifies you from collecting unemployment
Director’s fees
are self employment income and subject to social security tax
When an employer does not collect FICA tax from the employee but still pays full FICA amount
It is treated as income to the employee and the employer is not subject to penalty
Social security benefits
may include payments to spouses (some divorced) and children. May also include Medicare BUT NOT Medicaid
What is not considered earned income
Proceeds from Annuity
Pension payments
Stock Dividends
Earned income in excess of annual limitation amount
will cause a reduction in a retired person’s social security benefits
Unemployment insurance tax
1) must be paid by the employer if they employ anyone covered by the act
2) Not deducted from employee salaries
A car received as compensation
is subject to social security tax
Violation of the Federal Social Security Act
Includes Failure to supply employee TIN numbers
failure to collect taxes
failure make timely FICA Deposits
