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the Internal Revenue Service (IRS) and Treasury Department told employers that they would be liable to pay back what they defer from their employees’ paychecks under the executive memo, so workers won’t face a huge tax bill when they file their 2020 feder

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2 hours ago, Burgerwars said:

This whole fiasco is smoke and mirrors. Employees are going to owe exactly what was not deducted next year.

but how many employees understand this?

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4 hours ago, Burgerwars said:

This whole fiasco is smoke and mirrors. Employees are going to owe exactly what was not deducted next year.

this is not about deductions but rather the liability workers will have to pay their (deferred) 2020 social security.

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I don't pay in and my spouse hit the (stupid) ceiling in February so it doesn't impact me but it does seem some people think this is a free lunch.

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So, why the hell is this referred to as a "payroll tax deferral" when the only "tax" being deferred is the employee FICA contribution?  If this confused me until this helpful post, I anticipate most workers are confused as well (including the "deferral" part ... as has been noted here).

 

I read this as being voluntary, with respect to employer participation.  With most informed people expressing that this is a bad idea, the short implementation time, and the fact that the onus is on employers to repay the deferral (even, presumably if someone separates the company and the company neglects to deduct the deferral amount to date from their termination check) ... is there any employer who is actually going to willingly step up for such participation?

 

My last comment is withheld because there's simply no way to express it in a construct that doesn't walk up to, and cross, the "no politics" line.  (That said, I won't be surprised if employers who don't participate are villain-ized on Twitter.)

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5 hours ago, hdporter said:

So, why the hell is this referred to as a "payroll tax deferral" when the only "tax" being deferred is the employee FICA contribution?  If this confused me until this helpful post, I anticipate most workers are confused as well (including the "deferral" part ... as has been noted here).

 

I read this as being voluntary, with respect to employer participation.  With most informed people expressing that this is a bad idea, the short implementation time, and the fact that the onus is on employers to repay the deferral (even, presumably if someone separates the company and the company neglects to deduct the deferral amount to date from their termination check) ... is there any employer who is actually going to willingly step up for such participation?

 

My last comment is withheld because there's simply no way to express it in a construct that doesn't walk up to, and cross, the "no politics" line.  (That said, I won't be surprised if employers who don't participate are villain-ized on Twitter.)

Maybe voluntary for the employer, but not the employee.  As a "model employer," from what I read, the U.S. Government is automatically not withholding the payroll tax from all employees earning less than $4,000 per two-week pay period (the vast majority of employees).  Employees have no way of saying they want to continue the deduction.  The chances of Congress eliminating or forgiving this payroll tax is extremely low, since the Social Security system is in sad shape for the long term.  It's Congress, not the POTUS, that controls taxes and spending.  Starting next year, it's double-deductions for all the same employees to pay this back.

 

If this somehow becomes permanent (not going to happen) it's the worst sort of payroll tax reform.  I'm not even going to get into how it messes Social Security, but about the $104,000 per year income cut-off.  It's not phased in, meaning someone making $103,000 per year has a larger paycheck than someone making $104,000 per year.  If someone was offered a pay raise from $103,000 to lets say $105,000, their paycheck goes down.  Someone in such a position should refuse the pay raise, unless they get a much larger raise to offset the payroll tax.

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My understanding is that it's optional for some employers and mandatory for others to OFFER the deferral. It's not mandatory for anyone to actually defer the withholding. Yes employees can opt out of they want to and their employer offers the deferment.

 

I gave our employees the option and explained how it works to them. They all said some things the censor wouldn't like and no takers. I'm just glad I don't have to try to calculate varying deductions for a bunch of hourly employees.

 

 

Yes, this is going to screw up Social Security. 

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