In which situation must an employer withhold Social Security and Medicare tax?

An employer is required to withhold Social Security and Medicare taxes from all employees' wages regardless of their age. This means that it applies universally to every employee who is earning wages, including those over the age of 65 or 70.

Social Security and Medicare taxes are part of the Federal Insurance Contributions Act (FICA) and are mandatory on all compensation, with the only exceptions being individuals who are explicitly exempt due to certain stipulations (like some religious groups), but age alone does not provide such an exemption. Thus, the obligation to withhold these taxes applies universally, making the situation where withholding occurs unconditional based solely on age.

In contrast, the other options suggest age-related restrictions that do not align with federal tax laws on Social Security and Medicare withholding, as these laws do not provide for any exemptions based on the age of the employee.