chadw Posted February 9, 2008 Report Posted February 9, 2008 Have a client who just received a 1099-Misc box 7 with 5K in back vacation from a company that closed down a couple years ago. No SE tax correct? It was from a settlement when he filed a complaint with the state. He was a W-2 employee when he was employed there. Quote
lbbwest Posted February 9, 2008 Report Posted February 9, 2008 It should have been reported on a W2, report it on Line 7 with a 4137 for him to pay his half of the SS/Medicare. lbb Quote
kcjenkins Posted February 9, 2008 Report Posted February 9, 2008 Not subject to payroll taxes in this situation. Report it on Line 21. Quote
TAXBILLY Posted February 9, 2008 Report Posted February 9, 2008 http://www.irs.gov/publications/p15/ar02.h...d0e1752taxbilly Quote
lbbwest Posted February 9, 2008 Report Posted February 9, 2008 http://www.irs.gov/publications/p15/ar02.h...d0e1752taxbilly I already told the poster it was taxable... "Vacation pay. Vacation pay is subject to withholding as if it were a regular wage payment. When vacation pay is in addition to regular wages for the vacation period, treat it as a supplemental wage payment." Quote
lbbwest Posted February 9, 2008 Report Posted February 9, 2008 I think the confusion was created because of the rulings regarding LAWSUITS. This wasn't a lawsuit; it was a complaint made to the State, the state inquired and the company paid the back vacation pay. "It was from a settlement when he filed a complaint with the state." Quote
TAXBILLY Posted February 10, 2008 Report Posted February 10, 2008 I replied that way because KC and you differ in its treatment. I sided with you. :~)) taxbilly Quote
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