Is Social Security and Medicare tax required to be withheld from disability benefits paid by an insurance company? The disabled person is a partner in a partnership (not an employee) and has not deducted the premiums for income tax purposes. I understand that the withholding will be only for 6 months after becomming disabled but I'm thinking that because the benefits are non-taxable, they are not subject to any SS or Medicare tax.

It's my undestanding that if this is a group insurance plan sponsored by the employer that FICA taxes apply for the first 6 months of payments. In addition the benefit payments are taxable income to the extent that premiums are not paid by the partner.

If this is an individual insurance policy, I don't know the tax consequence.