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15. Special Rules for Various Types of Services and Payments

Section references are to the Internal Revenue Code unless otherwise noted.

Special Classes of Employment and Treatment Under Employment Taxes
Special Types of Payments
Income Tax Withholding Medicare (including FUTA
Social Security and
Additional Medicare Tax
when wages are paid in
excess of $200,000)
Aliens, nonresident. See Pub. 515 and Pub. 519.
Aliens, resident:
1. Service performed in the U.S. Same as U.S. citizen. Same as U.S. citizen. Same as U.S. citizen.
(Exempt if any part of
service as crew member of
foreign vessel or aircraft is
performed outside U.S.)
2. Service performed outside the U.S. Withhold Taxable if (1) working for Exempt unless on or in
an American employer, or connection with an
(2) an American employer American vessel or aircraft
by agreement covers U.S. and either performed under
citizens and residents contract made in U.S., or
employed by its foreign alien is employed on such
affiliates. vessel or aircraft when it
touches U.S. port.
Cafeteria plan benefits under section 125. If employee chooses cash, subject to all employment taxes. If employee chooses another
benefit, the treatment is the same as if the benefit was provided outside the plan. See Pub.
15-B for more information.
Deceased worker:
1. Wages paid to beneficiary or estate in Exempt Taxable Taxable
same calendar year as worker's death.
See the Instructions for Forms W-2 and
W-3 for details.
2. Wages paid to beneficiary or estate Exempt Exempt Exempt
after calendar year of worker's death.
Dependent care assistance programs. Exempt to the extent it is reasonable to believe amounts are excludable from gross
income under section 129.
Disabled worker's wages paid after year in Withhold Exempt if worker didn't Taxable
which worker became entitled to disability perform any service for
insurance benefits under the Social Security employer during the period
Act. for which payment is made.
Employee business expense
reimbursement:
1. Accountable plan.
a. Amounts not exceeding specified Exempt Exempt Exempt
government rate for per diem or
standard mileage.
b. Amounts in excess of specified Withhold Taxable Taxable
government rate for per diem or
standard mileage.
2. Nonaccountable plan. See section 5 for Withhold Taxable Taxable
details.
Family employees:
1. Child employed by parent (or Withhold Exempt until age 18; age Exempt until age 21
partnership in which each partner is a 21 for domestic service.
parent of the child).
2. Parent employed by child. Withhold Taxable if in course of the Exempt
son's or daughter's
business. For domestic
services, see section 3.
3. Spouse employed by spouse. Withhold Taxable if in course of Exempt
spouse's business.
See section 3 for more information.
Fishing and related activities. See Pub. 334.
Foreign governments and international Exempt Exempt Exempt
organizations.

Publication 15 (2020) Page 39