November 21st, 2008
IS THE PAY PER CALL TO VOLUNTEER FIRE-FIGHTERS MEDICARE TAXABLEHowdy fatherburns-ga,
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for informed professional medical, psychiatric, psychological, tax, legal,
investment, accounting, or other professional advice."
With a few exceptions, such as "expense payments under an accountable plan,"
it appears that in general that the "pay per call" income earned by a
volunteer firefighter is indeed subject to FICA (also also known as
Medicare)taxation.
Here is the Internal Revenue Service (IRS) article on exactly this subject,
"FICA Taxation of Volunteer Firefighters."
http://www.irs.gov/govt/fslg/article/0,,id=111350,00.html
"Many local governments entities rely on the services of individuals, such
as firefighters and emergency workers, who receive little or no regular
compensation. Workers who perform services for government entities are subject
to the same rules regarding social security and Medicare (FICA) coverage as
other workers. If they receive some form of compensation, including expense
allowances tax abatements, or noncash property, these rules must be followed.
It does not matter whether the workers are called 'volunteers' or that they
are not defined as employees by the entity?s administrative policy. It is
irrelevant whether they receive a regular salary.
...
Note: There are special rules under section 3121(b) to except emergency workers
from social security coverage. This exception applies only in the case that the
workers are hired only to respond to an unforeseen, unusual situation to peform
services related to that emergency (forest fire, flood, earthquake, flood,
etc.). Firefighters or emergency workers who serve or are available on a
continuing or regular basis do not meet this test.
If a volunteer receives only reimbursement or allowance for expenses, these
payments will be excludable only if they meet the accountable plan rules,
discussed in Circular E. If the tests are not met, then the allowances are
treated as wages, and subject to the withholding rules discussed above. If the
only consideration a volunteer receives are expense payments under an
accountable plan, and they are properly accounted for, there are no wages and
no withholding for income, social security or Medicare tax is required."
If you need any clarification, please feel free to ask.
Search strategy:
Google search on: "volunteer firefighters" employees medicare
://www.google.com/search?q=%22volunteer+firefighters%22+employees+medicare
Looking Forward, denco-ga - Google Answers ResearcherHowdy fatherburns-ga,
I would also suggest that you read the IRS document in detail for the other
few exceptions.
http://www.irs.gov/govt/fslg/article/0,,id=111350,00.html
Looking Forward, denco-ga - Google Answers Researcher
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