Hello any US accountants out there!  I am a sole employee of a sub s and pay myself a small salary each year.  Each quarter I pay the FICA (employer and employee).  On the W-2 should the FICA amounts equal the withheld amounts?  In other words is making a payment the same as withholding?  Last year I left the withholding blank and the IRS sent a letter asking why the 941 didn't match the W-2.  Thanks in advance.

It is unclear what you are asking. Do you mean:

1. You withheld the employee contribution of FICA/Medicare from your salary as normally happens in employment?

OR

2. That you, as the employer, paid the employee's share of FICA/Medicare in addition to the employer side?


I believe you are only allowed to do #2 in the event the employee is a domestic servant of your household.

In either case, there are FICA wages, Medicare wages and taxable wages. FICA wages are the baseline salary from which you calculate FICA taxes, Medicare for Medicare taxes, and taxable wages for income tax . Taxable wages are the gross wages paid minus any pretax deductions. FICA/Medicare wages and taxable wages do not need to be the same thing, as there are different rules for pretax deductions, (such as 401(k) deductible for taxable wages but not for FICA/Medicare wages) and the maximum FICA wage is limited to the annual limit for Social Security tax (the Medicare wages are unlimited).

You need to read the instructions to understand what each one of these boxes are for, and make sure you calculate each appropriately. There are 3 different wage values for each employee, and each box has specific rules for calculating them. If there are pretax deductions involved, the actual gross pay for an employee (the one listed on the pay stub) may not even appear anywhere on the W-2.

Thanks!  Yes, I paid the employee/employer's FICA each quarter since I am the only employee.  I called IRS and they said to report the withheld portion (paid) for the employee only because the W2 is about the employee, not the company.

 

You were the only one who responded so very much appreciated.