The Internal Revenue Service released information on how employees now have until the end of the year to repay any payroll taxes they deferred from last year.
Former President Trump issued a presidential memorandum last August allowing Social Security taxes to be deferred for the rest of 2020, but under the order they had to be repaid by April 30, 2021. The coronavirus relief package that Congress passed last month extended the repayment period until the end of this year.
Relatively few companies actually implemented the payroll deferral for their employees because there was no guarantee that the deferred payroll taxes would ultimately be forgiven by Congress. However, federal employees and military service members were still required to accept the payroll tax deferral, meaning those taxpayers will be facing smaller paychecks later this year.
Piyush Jain is vice president of engineering at Centage. With over 20 years of experience leading development teams for enterprise products, Mr. Jain is responsible for all aspects of product development at Centage. He brings deep expertise designing and delivering scalable analytics products, web and cloud-based architectures, OLAP, Big Data, Corporate Performance Management and Business Intelligence applications. Follow on Twitter @Centage.
Jordan Birnbaum has been with ADP since 2015, as vice president and chief behavioral economist. He directs the application of behavioral economics principles into new product development in the human capital management market. Prior to joining ADP, he was the owner/operator of The Vanguard in Los Angeles, a hybrid media production and live music venue, employing more than 150 people for close to a decade. He was a founding employee and senior vice president of business development of Juno Online Services, playing a key role in a successful IPO and then beating analysts’ estimates for six consecutive quarters. Jordan graduated from Cornell University with a BS, Policy Analysis, and from NYU with an MA in Industrial / Organizational Psychology.
Deb is highly respected throughout the insurance industry for strategic thinking, thought provoking research, and advisory skills. Insurers and solution providers turn to Deb for insight and guidance on business and IT linkage, IT strategy, architecture, and eBusiness. Those seeking an edge in today's highly competitive world turn to Deb to capitalize on her deep industry knowledge and experience and her specialized understanding of distribution and underwriting automation.Deb has held leadership roles in premier insurance companies, professional services firms, and research advisory organizations, where she consistently demonstrated the ability to find new ways to leverage technology to achieve optimal business outcomes. Her skill set includes linking business strategy to IT strategy; development of business and IT road maps; selection, shaping, and delivery of enterprise/core solutions; and implementation of right-sized governance models.Prior to founding SMA, Deb served as Chief Transformation Officer for Insurance Company of the West (CIO) where she was recruited to deliver as much IT functionality to the business operations as possible in the least amount of time. Deb led company-wide change that included developing and integrating the corporate business strategies into 5 Strategic Initiatives. Before joining ICW, Deb launched and served as Managing Director of TowerGroup's Insurance Research & Consulting Practice. As a Partner at KPMG LLP, she launched an IT consulting practice specializing in the assessment and management of IT risks. She began her career at Liberty Mutual, where she directed a variety of large-scale system development projects and rose to leadership of the commercial lines application development group.Deb's expert opinion and counsel is in demand by press, clients, and major industry events. She is a frequent contributor to leading insurance trade journals and has been a keynote speaker at major conferences such as ACORD/LOMA Forum, NAMIC, ISOTECH, and IASA. Deb is a graduate of the University of New Hampshire with a B.S. in Business Administration.
In Notice 2021-11, the IRS on Tuesday explained how employers who deferred payroll taxes on behalf of their employees can withhold and pay the deferred taxes throughout 2021 instead of just within the first four months of the year.
The deferral applied to employees who were paid less than $4,000 every two weeks, or an equivalent amount for other pay periods, with each pay period considered separately. The taxes, which are technically called Old Age, Survivors and Disability Insurance, or OASDI, are calculated at 6.2 percent of employees’ wages.
Notice 2021-11 makes changes to last year’s Notice 2020-65 to reflect the extended payment period. Payments made by Jan. 3, 2022, will be considered to be timely because Dec. 31, 2021, is a legal holiday. However, any penalties, interest and additions to tax will now start to apply on Jan. 1, 2022, for any unpaid balances
The IRS cautioned that employees could see their deferred taxes being collected immediately, so employees should check with their organization’s payroll point of contact on what their collection schedule will be.
