Director Fees - SE tax?

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  • Unregistered

    #1

    Director Fees - SE tax?

    1. I have an 84 year old client who is an honory director and receives $1000 compensation on a 1099 annually. He does attend one meeting a year. Is this Sch C income or line 21?

    2. He also receives a "pension" from the bank he previously was president of, approximately 10,000 per year on a 1099 as box 7 income. I believe I have a reasonable basis to list this as non employee income since he no longer provides any services to the bank.

    Would appreciate feedback on item 1 and item 2.

    P.S. good first round with the Tax Book

    thx
    Bobby
  • Bird Legs
    Senior Member
    • Jun 2005
    • 990

    #2
    S E Tax Directors Fees

    You might try IRS Pub. 533 & Pub. 334.

    Comment

    • Bees Knees
      Senior Member
      • May 2005
      • 5456

      #3
      TTB, page 5-25 "Corporate director fees. Subject to SE tax."

      As to the pension from the bank, since the bank is not using a 1099-R, it was probably a non-qualified deferred compensation plan. FICA is due on non-qualified deferred compensation plans when the participant is no longer at risk to lose the benefits - Section 3121(v)(2) (also see TTB, page 13-21). Since the bank is using a 1099-MISC, box 7, my guess this is for past services and is subject to Social Security tax.

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