The U.S. Court of Appeals for the Federal Circuit has ruled that severance pay is considered taxable wages under the Federal Insurance Contributions Act (FICA). The decision in CSX Corporation v. United States means organizations must pay Social Security and Medicare taxes on severance payments made to involuntarily displaced workers.
CSX had argued that severance should be treated like Supplemental Unemployment Benefit (SUB) payments, which aren’t considered wages under FICA.
Like what you've read? ...Republish it and share great business tips!
Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...
We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.
The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.
" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/4899/severance-pay-is-fica-taxable "