In Light Of US V. Quality Stores, Let's Look At SUB-Pay

Law360, New York (April 25, 2014, 1:04 PM EDT) -- The decade-long debate over whether or not severance paid to certain employees is considered wages for Federal Income Contributions Act tax purposes is over. On March 25, 2014, the U.S. Supreme Court ruled in favor of the Internal Revenue Service in United States v. Quality Stores Inc., deciding that severance payments employers made to involuntarily laid-off employees are “wages” and are taxable under FICA.

The court based its decision on an analysis of (1) the definition of “wages” in FICA — a statute that taxes “wages”...
To view the full article, register now.

Law360 UK

UK Financial Services

Read Our Latest UK Legal News & Analysis

Financial Services Law360 UK and Insurance Law360 UK provide breaking news and in-depth analysis on U.K. and European Union regulation, enforcement, legislation, and litigation involving banks, investment firms, insurers, and more.