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Employers in the U.S. have not rushed to offer
their workers a suspension of Social Security payroll taxes through the end of
the year, given that employees would need to repay those deferred taxes during
the first four months of 2021—unless legislation is enacted to forgive this obligation—under
guidance the IRS issued Aug. 28.
The payroll tax "holiday," or suspension period, runs from Sept. 1
through Dec. 31, 2020, and applies only to employees whose wages are less than
$4,000 for a biweekly pay period, including salaried workers earning less than
$104,000 per year.
Companies that suspend collection of employees' payroll tax would collect
additional amounts from workers' paychecks from Jan. 1 through April 30 next
year to repay the tax obligation
Read the rest of the article:
Employers Hesitant, Confused Over
Payroll Tax Suspension
SHRM | Sep 2020OMB Tells Agencies to Defer Federal
Workers' Payroll Taxes
SHRM | Sep 2020
Employee Social Security Tax Deferral
Guidance: Too Little, Too Late?
Winston & Strawn via SHRM | Sep 2020 IRS Guidance Makes Workers' Payroll Tax 'Holiday' Voluntary for Employers SHRM | Aug 2020 Notice
to Employees Explaining the Decision Not to Defer Social Security Tax
WithholdingNotice to Employees of Temporary Social Security Tax Deferral SHRM Samples | Sep 2020 Please complete the brief survey near the bottom of this page. Optional for Employers Shortly after the memorandum was released, Secretary Mnuchin confirmed that the deferral is voluntary and that employers may continue to withhold and deposit employee Social Security taxes in accordance with their normal schedule IRS Issues Notice 2020-65 Providing Guidance on Employee Social Security Tax Deferral Covington | Aug 2020 Employee Eligibility Can Vary by Pay Period In regards to the $4,000 bi-weekly limit, Notice 2020-65 clarifies that the limit is to be applied pay period-by-pay period, and "irrespective of the amount of wages or compensation paid to the employee for other pay periods." Thus, if between September 1, 2020 and December 31, 2020 an employee is paid less than $4,000 for a particular bi-weekly pay period, deferral of the employee's Social Security taxes is permitted for that period, even if the employee is paid more than $4,000 for another bi-weekly pay period (for which deferral would not be available under the President's memorandum). Risks Remain Following the IRS's Issuance of Guidance on the President's Payroll Tax Deferral Kelley Drye | Aug 2020 Employee Ability to Opt-Out Unclear The Notice does not provide any guidance regarding employee participation and if an employer chooses to defer withholding, whether such deferral must be for every eligible employee or whether the employer can limit the deferral to just those employees that request it. Employers Have Little Incentive to Implement Social Security Tax Deferral Under New IRS Released Guidance Partridge | Aug 2020 Risk for Employers Under the current guidance, employers are not obligated to participate in the deferral program. Employers who opt-in leave themselves at risk for repayment of the deferred tax with no guarantee that Congress will forgive the obligation. Despite the recent IRS guidance, the least risky plan of action is for employers to continue withholding and await release of complete IRS guidance or definitive legislative action, neither of which may ever transpire. Employers Face Difficult Decision About Deferring Payroll Tax Reinhart | Aug 2020 About the Presidential Memorandum Companies and payroll administration firms in the U.S. say they won't be able to comply with a presidential directive that sought to allow employers to defer employees' portion of Social Security payroll taxes beginning Sept. 1. On Aug. 8, President Donald Trump issued a Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster, which directed the Treasury Department to suspend collection of the employee portion of Social Security FICA taxes—part of required payroll tax withholding—from Sept. 1 through the end of 2020. The deferred taxes would have to be repaid unless Congress enacted legislation stating otherwise. Read the rest of the article: Lacking Time and Guidance, Businesses Won't Defer Employees' Payroll Taxes SHRM | Aug 2020 Actions on Payroll Taxes and Unemployment Benefits Promise Relief, Raise Questions SHRM | Aug 2020 Read the Presidential Memorandum here. Please complete the brief survey near the bottom of this page. Law Firm Articles The deferral applies only with respect to employees who generally are paid less than $4,000 per biweekly pay period ($104,000 annually) on a pre-tax basis, or the equivalent amount for other pay period frequencies. Trump Administration opens the take-out menu, orders payroll tax relief Eversheds Sutherland | Aug 2020 Given that a comprehensive stimulus bill may be passed that will obviate the need for the Executive Order, the anticipated Treasury guidance, and the September 1 effective date, we do not recommend that employers take immediate action to implement the deferral. What It Means: Executive Order on Deferring Payroll Tax Obligations Jackson Lewis | Aug 2020
Index of COVID-19 Express RequestsReopening Your WorkplaceReopening Your Workplace: OverviewsMasks/Face Coverings in the WorkplaceTips for Wearing a Mask in SummerRecalling/Rehiring EmployeesWhen Employees Refuse to Return to WorkAddressing Fears About Returning to the WorkplaceTesting | Screening | Diagnosis | VaccineTesting Employees for COVID-19Taking Employee TemperaturesAntibody Testing (or Not)Responding to Employee's COVID-19 DiagnosisContact-Tracing in the WorkplaceMandating COVID-19 VaccineEmployee RelationsPreventing COVID-19 Related Workplace ViolenceEmployee Travel Amid the PandemicUpdating an Employee Handbook for COVID-19Shadow Pandemic: Rise in Domestic ViolenceCOVID-19 Liability Waiver ConsiderationsEncouraging Employees to Take Time OffVacation Policy Changes Amid PandemicHeat Illness Prevention Amid COVID-19Accommodating Workers at Higher Risk for Severe IllnessCOVID-19 Myth BustersEEOC Updates Coronavirus-Related GuidanceCommunicating with EmployeesRemote WorkersRemote Workers' Expense ReimbursementAllowing TeleworkEngaging Remote WorkersRemote Work & State Tax IssuesMonitoring Remote WorkersCombatting Zoom FatigueTalent AcquisitionForm I-9 Flexibility Due to EAD Production DelaysVirtual OnboardingPreemployment Background Checks During COVID-19Completing Form I-9 for Remote WorkersDocumenting an Expired Driver's License on I-9 and E-VerifyExecutive Order Restricts Employment-Based ImmigrationFamilies First Coronavirus Response Act (FFCRA)FFCRA: School Reopening (or Not) PlansGeneral (Overviews, DOL Resources, More)IRS FAQs on Tax Credits & Required DocumentationDecision Flow ChartsValuing Health Plan Costs for Tax CreditsCoronavirus Aid, Relief and Economic Security (CARES) ActOverviews of Implications for EmployersEmployee Retention Tax CreditBusiness & Nonprofit ReliefEmployee Benefit Plan ProvisionsPaycheck Protection Program (Loan Forgiveness)Unemployment Expansion & ExtensionPotential Relief for Government ContractorsValuing Health Plan Costs for Tax CreditsCompensation and BenefitsLost Wages Assistance (Unemployment Benefits)DOL on Tracking Teleworkers' HoursWorkers' Payroll Tax DeferralVirtual Benefit FairsHealth Carrier COVID-19 Premium CreditsCOBRA Deadlines Temporarily ExtendedVarious Benefit Plan Deadline ExtensionsSurvey Reports: Pay Adjustments Amid COVID-19Families First Coronavirus Response Act (Paid Leave; Enhanced FMLA; More)USERRA and COVID-19Reducing Employer's Retirement Plan Contribution/MatchU.S. Wage and Hour IssuesMaking Tax-Favored Disaster Relief Payments to EmployeesLeave Donation ProgramsIRS Relaxes HDHP RulesLayoffs and Alternatives to LayoffsPay ReductionsShared-Work/Work Share ProgramsLayoff AlternativesWorker Adjustment and Retraining Notification (WARN) ActCalifornia EDD Work Sharing ProgramPlease also see under CARES Act (above):Employee Retention CreditPaycheck Protection ProgramEssential Businesses and WorkersEssential Business DesignationEssential Workers: IdentifyingGeneralEmployer Resource Centers (U.S. and Global)Preparedness PlanBeware Phishing ScamsTell Us About Your Workplace’s ResiliencyHR professionals have played a critical role in leading their organizations through some of the toughest workplace challenges they’ve ever faced. Public officials need to hear from HR professionals about how they are adapting to new challenges, adjusting business practices and providing innovative solutions for the world of work. Tell us how your organization has been resilient during the COVID-19 pandemic.SURVEY: Tell us what you think about the Express Request service in four quick questions.
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