4. Social Security and Medicare Taxes Generally, you must withhold social security and Medicare taxes onall cash wage payments you make to your employees. Tartu hotelsThe $150 Test or the $2,500 Test All cash wages you pay to an employee during the year for farmworkare subject to social security and Medicare taxes and income taxwithholding if either of the two tests below is met: You pay cash wages to an employee of $150 or more in a yearfor farmwork (count all cash wages paid on a time, piecework, or otherbasis). The $150 test applies separately to each farmworker youemploy. If you employ a family of workers, each member is treatedseparately. Do not count wages paid by other employers. The total you pay for farmwork (cash and noncash) toall your employees is $2,500 or more during theyear. Exceptions.The $150 and $2,500 tests do not apply to the following situations: Wages you pay to a farmworker who receives less than $150 inannual cash wages are not subject to social security and Medicaretaxes, or income tax withholding, even if you pay $2,500 or more inthat year to all your farmworkers, if the farmworker: Is employed in agriculture as a hand-harvest laborer, Is paid piece rates in an operation that is usually paid ona piece-rate basis in the region of employment, Commutes daily from his or her home to the farm, and Hoteles con reservaciones online EgerHad been employed in agriculture less than 13 weeks in thepreceding calendar year. Amounts you pay to these seasonal farmworkers, however, counttoward the $2,500-or-more test to determine whether wages you pay toother farmworkers are subject to social security and Medicare taxes. Cash wages you pay a household employee are counted in the$2,500 test, but are not subject to social security and Medicare taxesunless you have paid the worker $1,200 or more in cash wages in 2000.This amount was $1,100 for 1999. See the table, Lillehammer luxury hotelsHow Do EmploymentTaxes Apply to Farmwork?, on page 19. Social Security and Medicare Tax Rates For wages paid in 2000, the social security tax rate is 6.2% forboth the employee and employer, on the first $76,200 paid to eachemployee. You must withhold at this rate from each employee and pay amatching amount. The Medicare tax rate is 1.45% each for the employerand the employee on all wages. Multiply each wage payment by thispercentage to figure the amount you must withhold. Employee share paid by employer.If you would rather pay the employee's share of the social securityand Medicare taxes without deducting them from his or her wages, youmay do so. If you do not deduct the taxes, you must still pay them.Any employee social security and Medicare taxes you pay is additionalincome to the employee. Include it in the employee's Form W-2, box 1,but do not count it for social security and Medicare wages, boxes 3and 5. Do not count the additional income as wages for FUTA taxpurposes. Social security and Medicare taxes apply to most payments of sickpay, including payments made by third parties such as insurancecompanies. For details, get Pub. 15-A.