Jump to content

Account balance plan with earning and then FICA taxed


Recommended Posts

A participant defers a portion of his salary in January until termination, and each month the deferral account is credited with 4% interest.  When FICA tax is paid at the end of the year (using the rule of convenience), does the amount subject to FICA include the original amount of salary deferred plus the interest accrued throughout the year, or is the amount subject to FICA only the original amount of salary deferred? 

Link to comment
Share on other sites

The only other item I'd add is whether 4% is "reasonable" and whether any portion of the 4% earnings after the balance is taken into account is still subject to FICA.

 - There are two types of people in the world: those who can extrapolate from incomplete data sets...

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...