Payroll Tax Guidance

The IRS got around to issuing “guidance” on the president’s order regarding deferral of Payment of Social Security and Medicare taxes.
www.irs.gov...

As of next payday, we can stop withholding from paychecks (a total of 7.65% of wages) through the end of the year. However, beginning January 1, we will be required to start making up for the deferral by April 30, presumably by bumping the withholding amounts.

Employees may be expecting more money in their paychecks, but I don’t think that this is a really good idea for them or a company. If any employee is lost before the deferral is covered the company may be on the hook for the amount due. The guidance says, “If necessary, the Affected Taxpayer may make arrangements to otherwise collect the total Applicable Taxes from the employee.” Does that mean we put a lien on the employee? Have "some of the boys" pay them a little visit?

The president’s order is idiotic. But what else is new? I don't think we are going to stop withholding.

a reply to: Phage

It sounds like a lot of people are going to have to start learning to calculate their own taxes.

If necessary, the Affected Taxpayer may make arrangements to otherwise collect the total Applicable Taxes from the employee.” Does that mean we put a lien on the employee? Have "some of the boys" pay them a little visit?

Sure does sound like that.

Honestly, if my employer asked me to start dealing with my own taxes, I'd tell them straight up to make me a subcontractor.

That's basically what it sounds like is happening to me any way. Come next april, if those employees haven't dealt with their taxes, they're going to be in for a surprise.

a reply to: dug88

the Affected Taxpayer may make arrangements to otherwise collect the total Applicable Taxes from the employee.

"Affected Taxpayer" is the employer.

We have to pay back all the extra money we'll get on our paychecks?

a reply to: Phage

Yeah I know, but where's the employer going to be taking that money from? As I said, if it was me I'd tell my employer no, or make me a subcontractor. That arrangement is ridiculous. In the end, the employee will have to pay.

I've already told my wife too start putting extra money aside each paycheck to pay this help back.

Is there an opt out option? I dont need the extra money nor do I need the added headache this will cause down the road.

The best thing that most people can do is to save the extra money that is going to be in their checks. That way they are sure to have the money when it comes time to pay. Otherwise, there will penalties added and eventually property will likely be seized.

originally posted by: Phage

The president’s order is idiotic. But what else is new? I don't think we are going to stop withholding.

agreed and its more worthless even than the other so called tax ciut he did before.

alot of people are going to get a nice surprise after election

however i wouldn't be surpriced this being another trump troll for the left and the msm where he lets them dwell on it then passes something for forgivimg the debt. although not holding my breath on that .

on a good note he did pass law that got rid of student interest rates till jan.

having said that and not being a trump supporter nor voting for him , biden the msm and the left makes Trump look reasonable.

originally posted by: trollz
We have to pay back all the extra money we'll get on our paychecks?

Yes.
Unless Congress passes a law that says you don't. I wouldn't hold my breath if I were you.

originally posted by: WeDemBoyz
Is there an opt out option? I dont need the extra money nor do I need the added headache this will cause down the road.

It's up to the employer, or possibly the payroll service which is used.

a reply to: interupt42

he lets them dwell on it then passes something for forgivimg the debt.

He can't do that. And if he gets re-elected, he won't really care anymore.

on a good note he did pass law that got rid of student interest rates till jan.

Again, Trump cannot pass any laws. His EO extended the provisions provided by the Cares Act by two months. Under that law, interest does not accrue on some student loans.

Could be when this "notice" gets into the Federal Registry somebody will sue for automatic forgiveness because individual taxpayers have no control or choice 😎

But business do this all the time during lean times; pull in next years revenue into this year.

a reply to: xuenchen

Anyone can sue for anything. That doesn't mean their case has merit.

a reply to: DanDanDat

Remember when people were bummed because their tax refunds got smaller?

originally posted by: Phage
a reply to: DanDanDat

Remember when people were bummed because their tax refunds got smaller?

Tax refunds are just a no interest loan to the government; if people can avoid them they should.

If you’re worried, just have your employer withhold that money from your paycheck. It was and still is an option for employees, even before this EO.

a reply to: Phage

A furlough on payroll taxes isn't idiotic because of Trump. it is idiotic because as you said, don't expect our idiotic Congress to feel compelled to do what actually might help citizens rather than their pals they have everywhere who then owe them favors.

I like how you turned this against Trump though, as idiotic as that was using your own words.

Somebody just told me this irs-n-20-65 pertains to Employers not Employees 😎

OhOh 😎