Random question: If I leave and am paid out for a few weeks of vacation, do I pay social security taxes on that or only income tax?
I’m trying to estimate what my payout would be.
4 replies (most recent on top)
@af, what makes you think vacation payout is not subject to FICA? It absolutely is unless you've maxed out already.
@af I’m well below pension age, but appreciate the heads up!
Will be moving into a new company, so assume my medical insurance with them will kick in the first of the month after I start there.
You pay income tax but not FICA. Payout is not earned income. Buy it’s also not pensionable. If you’re eligible for a pension, better to take those vacation days at the end to earn the pension on them.
Also, medical insurance goes by the month so best to stay on payroll until the first of the month to get a full month of insurance on your way out.
You will absolutely pay all taxes as normal. Vacation days do not get any special treatment