In determining whether FICA and Medicare taxes must be withheld from studentsí payroll, the federal government looks at whether an individual is more of a student or an employee at any given time during the year/semester. The factors that establish this are:
- The number of credits for which the student is enrolled
- The number of hours the student is working per week
During the academic year
, student employees are prohibited from working more than 30 hours per week (60 hours per pay period) AND they must be enrolled in a number of credits that equates to half-time status (6 undergraduate credits for undergraduate students and 3 graduate credits for graduate students). If a student meets these requirements, s/he does not pay FICA tax. Therefore, typically Social Security and Medicare taxes are not withheld from studentsí paychecks during fall and spring semesters. Because the winter break is less than 5 weeks long, we also do not have to withhold FICA over that break.
During the summer
, student employees at Winona State are not required to be enrolled (they do have to be pre-registered for fall semester) AND they are allowed to work up to 40 hours per week (80 hours per pay period). This results in a majority of the student employees in the summer paying FICA and Medicare taxes. The guideline for summer employment is:
- If a student is NOT enrolled in any credits, s/he will pay FICA.
- If a student IS enrolled for at least 3 credits in the summer AND is working more than 60 hours per pay period, s/he will pay FICA.
- The only situation in which a student would NOT pay FICA in the summer is if s/he is enrolled for at least 3 credits AND is working fewer than 61 hours per pay period throughout the entire summer.
The Student Payroll Office must make the determination for whether each student is subject to FICA or not based on the above criteria. Therefore, supervisors are required, in the summer, to complete a FICA Withholding Form (PDF) for any employee they project will be working more than 60 hours per pay period in the summer.
FICA withholding cannot be turned off and on throughout the summer. Once it has been projected that a student will work more than 60 hours/pay period, FICA will be withheld for the entire timeframe over which this work schedule is projected; it is not altered based on actual number of hours worked each pay period.
If a student is less than half-time during his or her final semester at the University, he or she may be subject to FICA withholding.