Employers & Employment, Labor, Regulations & Compliance

Farmers, Growers Need to Remember Social Security Obligations to Farm Workers

From SiouxCityJournal.com, “Greg Heineman, District Manager in Norfolk, 16 Nov 2011.

As American farmers and growers prepare for the next planting season, they should also make sure they know the rules that affect Social Security protection for their workers.

If you are a farmer or grower, the workers you hire become part of a system of income protection that pays monthly Social Security benefits to a worker and his or her family when the worker retires, becomes disabled or dies.

Most farm workers are “covered” by Social Security, and farm owners need to be aware that if they don’t report wages and pay the taxes due, they could be subject to an IRS penalty.

Can farm workers be considered independent contractors? The answer is no, they cannot be considered independent contractors, if they are working under a farm owner’s direction and control. 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 is often 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 right 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.

If you employ farm workers you must keep a record for each worker, collect and pay Social Security taxes, prepare Form 943 (Employer’s Annual Federal Tax Return for Agricultural Employees) and provide a pay statement and prepare a W-2 form.

For more information about tax responsibilities, you should read 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 at 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.

The pamphlet also tells you how to report your own income to Social Security, whether you are an owner/operator, partner, renter, share farmer or crew leader.

Source: SiouxCityJournal.com, “Farmers, growers need to remember Social Security obligations to farm workers” by Greg Heineman, District Manager in Norfolk, 16 Nov 2011.

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