Wages paid after the year of death are subject to which withholding taxes?

When an employee passes away, the wages paid to their estate or beneficiaries are not subject to withholding for Social Security, Medicare, or federal income tax. These forms of withholding are generally tied to compensation for services provided during an individual's lifetime. Once the employee is deceased, their earnings are no longer considered compensation for services rendered, thereby eliminating the application of these withholdings.

FUTA (Federal Unemployment Tax Act) also is not applied to wages paid after death because it pertains to the unemployment insurance system that supports individuals who are actively seeking work due to job loss. Since a deceased person is not capable of seeking employment, the wages are not subject to FUTA either.

It's important to understand that although the obligation to withhold these taxes ends with the individual’s death, any wages owed to the estate must be reported to the IRS by the executor or administrator of the estate, but without withholding.