Payments to Employees That are Exempt from FICA Tax:
This is a list of some of the most common types of payments to employees
that are exempt from being included in wages subject to FICA tax.
For a complete list, see IRS Publication 15, Chapter 15
Some disabled worker wages paid after the year the worker was entitled to
disability insurance
Employee business travel expenses reimbursed for amounts not exceeding the
specified government rate for per diem or standard mileage
Family employees under age 18 (age 21 for domestic work)
Fringe benefits are taxable "on excess of fair market value of the benefit
over the sum of an amount paid for it by the employee and any amount
excludable
by law."
Employee insurance
Payments to partners of a partnership
Employer contributions to qualified retirement plans
Payments to statutory non-employees (such as qualified real estate agents
and
direct sellers)
Tips under $20 a month
Workers compensation payments
