Published: May 26, 2008 11:21 pm            

Plant seeds for workers’ retirement by paying Social Security taxes on wages

Spring is here, and that means many Wabash Valley farmers are sowing seeds and putting their land to work. If you’re a farmer or grower who hires others to work on your land, there’s something you should know: You’re growing more than just your crops. By paying Social Security taxes on wages you pay your workers, you’re planting the seeds for their retirement funds.

Most farm workers are covered by Social Security. If you employ farm workers, you must keep a record for each one, collect and pay Social Security taxes, and provide a pay statement and prepare a W-2 form.

A common misconception many farmers and growers have is that farm workers are considered to be independent contractors and are therefore responsible for their own taxes.

However, under the law, if they are working under a farm owner’s direction and control, they cannot be considered independent contractors. They are employees and their wages must be reported to Social Security. Some farmers hire “crew leaders” to manage their farm workers and to handle their entire wage – reporting responsibilities. In these cases, the crew leader often is considered the “employer” of the farm worker and has the responsibility for submitting wage reports.

Whether a farmer or crew leader submits wage reports, we always stress the importance of recording the correct name, Social Security number and earnings for each employee. We tell all employers to make sure that they use the name and number exactly as it is shown on the worker’s Social Security card.

Of course, farm workers are often seasonal employees and may also be migrants. If a farm worker moves frequently and has trouble getting mail, you can give him or her a W-2 when the job ends, instead of waiting until Jan. 31 of the next year. For more information, get IRS Publication 51, Circular A (Agricultural Employer’s Tax Guide). You can order IRS forms and publications by calling 1-800-Tax-Form (1-800-829-3676).

If you need more information about agricultural work and Social Security, you can visit Social Security online at www.socialsecurity.gov and read the electronic pamphlet “A Guide for Farmers, Growers, and Crew Leaders.” Or you can call Social Security’s toll-free number, 1-800-772-1213 (TTY 1-800-325-0778) and ask for a copy or copies of the pamphlet. This is a bilingual pamphlet that includes both English and Spanish.

So remember, when you sow the seeds of your crop, you’re growing more than what you’ll reap at harvest time.

You’re planting the seeds for retirement funds that your employees will benefit from in the future.

For more information about Social Security, visit www.socialsecurity.gov.

        

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