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PDtax, CPA firm owner
Category: Social Security
Satisfied Customers: 4673
Experience:  35 years tax and professional advice in all matters money
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Should there be a FICA deduction on a severance check

Customer Question

should there be a FICA deduction on a severance check for a retired employee over 66 and unemployed re social security benefits
Submitted: 2 years ago.
Category: Social Security
Expert:  PDtax replied 2 years ago.

Hi from Just Answer. I'm PDtax, and will assist.

Expert:  PDtax replied 2 years ago.

Severence pay is subject to FICA, which both you and your employer have to pay. In some cases, it could help you, s it might bump up your social security benefits. In some, it may have no effect. We don't get to choose.

It also means that your wages will be boosted for unemployment benefits. Any other kind of settlement would bnot be treated as wages, and you would likely lose out on some unemployment benefits.

Thanks for asking at Just Answer. Positive feedback is appreciated. I'm PDtax.