The funding support for the Social Security system is the collection of taxes from employees and employers under the Federal Insurance Contributions Act (FICA) and the Self-Employment Contributions Act (SECA). These taxes are based on wages paid for employment or on self-employment income derived from carrying on a trade of business and are collected by the Internal Revenue Service. Most work performed is covered employment for Social Security purposes, but there are exclusions and one should turn to both the Social Security Regulations and the Internal Revenue Code for guidance when cases arise.
If an employee is under covered employment, then FICA taxes should be collected by the employer by deduction of wages paid. The employer’s deduction of the taxes is considered to be payment by the employee who is liable for the correct amount of taxes until it is collected from him. See 26 C.F.R. § 31.3121; 20 C.F.R. § 404.1001 et seq. Self-employment taxes are to be paid on income derived from a trade or business.
A quarter of coverage (QC) is the unit used to determine a worker’s insured status. Quarters are credited based on the wages the worker earns during certain periods of time and become credited upon payment of FICA or SECA. 20 C.F.R. §§ ;404.101; 404.140, et seq. Intuitively, each calendar year contains four quarters and an individual can earn up to four quarters per year. The SSA publishes the yearly amounts or income required to earn a quarter or four quarters per year. If the worker earns enough throughout the whole year (more than 4 times the amount for a quarter), then she is credited with four quarters of coverage. If it is more than two times the amount for a quarter, but less than three, then the worker is credited with only two quarters of coverage. C.F.R. § 404.143.
If you need more information about a Social Security Disability/SSI matter, personal injury matter (car wreck, boating accident, slip and fall, etc.), EEOICPA claim, long or short-term disability, VA disability, or a workers compensation matter, please contact the Law Offices of Tony Farmer and John Dreiser for a free case evaluation. We can be reached at (865) 584-1211 or (800) 806-4611, through Facebook, or through our website. Our office handles claims throughout East Tennessee, including Knoxville, Chattanooga, Kingsport, Bristol, Johnson City, Morristown, Maryville, Rogersville, Dandridge, Tazewell, New Tazewell, Jefferson City, Strawberry Plains, Sevierville, Gatlinburg, Loudon, Kingston, Halls, Maynardville, Crossville, Cookeville, Jamestown, Sweetwater, Lenoir City, Athens, Oak Ridge, Clinton, LaFollette, Lake City, Jacksboro, Bean Station, Cosby, Newport, White Pine, Mosheim, Wartburg, Sunbright, Pigeon Forge, and Deer Lodge.
- John Dreiser to Present on Complex Social Security Law Issues (farmerdreiser.wordpress.com)