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.
Brien Joyce is vice president of lender services at EFG Companies.
Hermann Sidhu is EY’s global assurance digital leader. He is responsible for utilizing game-changing technologies and practices to drive large-scale connectivity and digital innovation across the global audit practice. Sidhu is leading a team focused on creating more specialized, detailed and differentiated audit services by incorporating AI, robotic process automation and analytics. Prior to relocating to Dublin in 2011, Sidhu spent most of his career working in the United States and Japan where he served large listed multinationals to emerging companies within the technology and telco sectors. Currently, in Ireland Hermann serves the Irish and EMEA operations of some of EY's largest Global Fortune 100 clients as well as advising domestic clients on successful IPOs and M&A transactions. Sidhu is a licensed CPA in the state of Florida, USA. He graduated from the University of Florida with both a bachelor of Finance and Accounting degree and a Masters in Accounting.
Persico leads the global assurance service line, which is composed of nearly 70,000 people worldwide, and has the overall responsibility for developing its strategy.
In addition to auditing, his competencies include transaction support, IPOs, IFRS conversion and SEC filings.
Persico joined EY in 1986 and has served in a wide range of roles in both Europe and the US, including assurance leader for EMEIA, assurance COO for EMEIA, assurance leader for Italy and the former continental western Europe area and sector leader for technology and communication. In addition to auditing, he has experience of transaction support, IPOs, IFRS conversion and SEC filings. He still serves as the global client service partner for several Global Fortune 500 companies.
During Persico's three-year tenure as EMEIA assurance leader, he worked extensively with European regulators, and successfully established the Assurance specialty practices including Fraud Investigation and Dispute Services, Financial Accounting Advisory Services and Climate Change and Sustainability Services.
Persico is on the board of several foundations and contributes his time to various education and not-for-profit organizations.
Felice has a master's degree in business economics from the University of Turin School of Business, where he has also been a professor of accounting and auditing. He is qualified and active as a U.S. CPA and as an Italian Chartered Accountant (Dottore Commercialista and Revisore Contabile).
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.
