The information posted on PayrollTalk is for informational purposes only and is not intended to substitute for obtaining accounting, payroll, tax, or financial advice from a professional accountant.

401K contributions taxability

Trying to confirm if 401K contributions are taxable for North Carolina unemployment tax. Waiting to hear back from the state on this. Would be nice to have one post where everyone would answer this for the states they live in or know about.

Comments

  • rrupertrrupert ✭✭✭

    To my understanding, yes they are..... We use ADP Workforce Now and are based in CharlotteNC and the only thing that does NOT count are our Section 125 Medical benefits that also are not taxed for FICA (whereas 401k is on both). I've tried to research a bit and agree with you that NC doesn't do a good job on unemployment website to tell employers for sure though.

  • My understanding is that 401(K) deferrals have no effect on FUTA, SUTA or FICA calculations. That FIT and SIT/LIT only are effected, and SIT/LIT is a function of state/local law and some jurisdictions might not follow the federal rules.

    Section 125 can in theory effect everything although state/local governments (as indicated above) sometimes get creative with THEIR rules

Sign In or Register to comment.