Businesses that have employees and pay wages and salaries must withhold federal employee income taxes and the employee's share of federal employment taxes (FICA) from these wages and salaries. The employer must "match" the employee's FICA share, and these three components then become the employer's "federal tax deposit," which the employer must electronically pay to the IRS periodically. The frequency of when federal tax deposits must be made by an employer varies (weekly, bi-monthly, monthly, etc.) depending on the amount of these federal "payroll" taxes that are due.
The ...
Writing for an 8-0 majority, with Justice Kagan abstaining, Justice Anthony Kennedy handed down the Supreme Court's ruling in the closely-watched United States v. Quality Stores, Inc., et al. case March 25, holding that severance payments to involuntarily terminated employees are taxable wages under the Federal Insurance Contributions Act (FICA), and thus subject to Social Security and Medicare withholding. The Court took issue with a Sixth Circuit opinion which had found such payments not subject to withholding, stating that "[t]o reach its holding, the [Sixth Circuit] Court ...