Issue Number: 2005-01
Inside This Issue:
- Aid for Tsunami Victims May Be Tax Deductible
- Student FICA Exception: Final Regulations
- New on IRS.gov: Employment Tax Information for Charities
1. Aid for Tsunami Victims May Be Tax Deductible
Aid for victims of the December 2004 Tsunami in Southeast Asia may be tax deductible as charitable contributions. For more information, read the Aid For Tsunami Victims story on the IRS.gov Web site, and IRS Publication 3833, Disaster Relief, Providing Assistance Through Charitable Organizations.
2. Student FICA Exception: Final Regulations
The IRS and Treasury Department have issued final regulations clarifying the student exception to the FICA (Social Security and Medicare) taxes for students employed by a school, college, or university where the student is pursuing a course of study.
The regulations clarify that whether the organization is a school, college, or university depends on the organization’s primary function. They also clarify that whether employees are students for this purpose requires examining the individual’s employment relationship with the employer to determine if employment or education is predominant in the relationship. For more information please read the Student Exception to FICA Tax content in the Charities section of the irs.gov Web site.
3. New on irs.gov: Employment Tax Information for Charities
New resources are available on the IRS website for charities and other tax-exempt entities with paid employees. The Employment Taxes for Exempt Organizations Web page includes information about how to determine if a worker is a volunteer, contractor or employees, and what the respective withholding and filing requirements are for organizations. In addition, employers can download tax forms and publications, and other resources.