Farm and Town Payroll
From a farm with three hands to a clinic with forty nurses, Lubbock payroll has no state income tax to withhold, only the federal taxes and Texas unemployment tax. Farms, though, play by a separate set of federal rules, and gins sit between farming and industry. We process payroll for South Plains employers from our office online.
Federal and TWC basics are on our Texas payroll page, and this page covers farm workers and seasonal gins.
Agricultural Workers
Farms report wages for agricultural employees on Form 943, filed annually, rather than quarterly Form 941. Social Security and Medicare apply when a farm pays an employee $150 or more in a year or spends $2,500 or more on all farm labour. Federal unemployment tax applies to farms that pay $20,000 or more in a quarter or employ 10 or more workers on at least one day in 20 different weeks. Texas unemployment tax has its own thresholds for agricultural employers.
H-2A Workers
Farms using H-2A temporary agricultural workers must pay the adverse effect wage rate set for Texas and meet housing and transportation requirements. H-2A wages are exempt from Social Security, Medicare and federal unemployment tax, and federal income tax is withheld only if the worker and the farm both agree, using a Form W-4. Wages are still reported on Form W-2.
Gin Season
Gins hire seasonal workers from fall through winter, often for long shifts. For Social Security, Medicare and federal unemployment tax, work in connection with ginning cotton counts as agricultural labour wherever it is done, so gin wages fall under the farm rules and are reported on Form 943. Federal overtime law treats gins under its own separate rules, so pay practices for long shifts still need checking. We review each gin's set-up.
Students
Businesses near Texas Tech hire students part time. Students working for private employers pay Social Security and Medicare, except nonresident international students on F-1 visas. Students employed by the university may be exempt under the student exception.
Medical Staff
Hospitals and clinics employ nurses, technicians and staff on shifts with differentials and on-call pay. These amounts must be included in the regular rate for overtime. Staffing agencies supplying travel nurses pay stipends that are tax free only if the nurse maintains a tax home elsewhere.
Restaurants
Broadway and campus-area restaurants can pay servers the $2.13 tipped wage when tips make up the rest of $7.25 an hour. Servers report tips to the employer, an automatic gratuity on a large table is wages rather than a tip, and the W-2 lists qualified tips for the federal deduction that runs for 2025 to 2028.
Texas Workforce Commission
A non-farm Lubbock business owes Texas unemployment tax after $1,500 of wages in a quarter or a worker in 20 separate weeks of a year. Most start at 2.7 percent of the first $9,000 per worker and report quarterly. Farms register when they pay $6,250 in cash wages in a quarter or employ three or more workers in 20 weeks, so many small family farms are not covered.
Family Members on the Farm
Wages a farmer pays to his or her own children under 18 are exempt from Social Security and Medicare when the farm is a sole proprietorship or a partnership owned only by the parents, and children under 21 are exempt from FUTA. Paying children for real work at reasonable rates shifts income into lower brackets and can fund Roth IRAs, but the work must be documented. The exemptions do not apply if the farm is a corporation.
Commodity Wages
Some farms pay workers partly in kind, such as with livestock or crop shares. Non-cash wages paid to agricultural workers are not subject to Social Security and Medicare, but they are reported as income to the worker. We record the value and report it correctly.
Our Services
- Form 943 and 941 filings.
- H-2A payroll and reporting.
- Seasonal gin payroll.
- Student and medical staff pay.
- TWC and year-end forms.
Lubbock Payroll Questions
Do farms file Form 941?
No. Agricultural employers file Form 943 annually for farm workers.
Are H-2A workers subject to FICA?
No. H-2A wages are exempt from Social Security, Medicare and FUTA.
Are gin workers agricultural for payroll tax?
Yes. Ginning cotton is agricultural labour for Social Security, Medicare and FUTA, so gins generally report on Form 943.
Are travel nurse stipends taxable?
They are tax free only if the nurse keeps a tax home elsewhere.
Talk to BOMCAS About Payroll in Lubbock
Payroll entries go to the books and wages to the business return, and owner pay is part of planning. Missing farm forms are fixed in back taxes, workers can get help with personal returns, bars file mixed beverage tax, and foreign workers raise cross-border questions. From the Panhandle to the coast, our Texas pages on business and farm returns, personal returns, sales tax, bookkeeping, planning, late filing and cross-border tax set out the statewide rules, gathered in the Texas overview.
Whether it is a section of irrigated cotton, a shop on 34th Street or a household near campus, a short description is enough for BOMCAS to suggest a starting point and list the records a quote would need. Reach us on the contact page or the form below, call 780-667-5250 or email info@bomcas.ca. Each Lubbock service is linked from the Lubbock overview. Nothing here is advice for a particular farm, business or family.