Compensation payments


An employer pays an injured worker $500 a week. That employer receives workers compensation reimbursement from their insurer of $475 a week. The $475 does not attract payroll tax but the $25 make-up pay is taxable.

Further references

See Revenue Rulings GEN-001, PTA-015 Workers compensation payments.


If you need further information on this topic, please contact our payroll tax enquiry service on 13 21 61.