NEWS

What is the deferral?

  • The deferral is on the employee share (6.2%) of Social Security Payroll tax
  • The deferral period is from September 1,2020- Dec 31,2020
  • This is only a deferral; the guidance does not indicate taxes will be forgiven

What determines if an employee is eligible for the deferral?

  • Taxes may only be deferred for employees whose applicable wages are less than $4,000 on a bi-weekly pay period
  • The deferral eligibility is based on a pay period by pay period basis
What’s the role of the Employer?
  • Employers are not required to offer the payroll tax deferral to employees.
  • Employers are responsible for collecting and paying back any deferred taxes. Payments would be due between September 1, 2021 and April 30, 2021.
  • Penalties and interest on unpaid amounts begin accruing May 1, 2021.
  • It will remain the employer’s responsibility even if they are unable to collect the deferred amount from their employee(s).
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