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.
Ingo Weinem leads EPAM's European insurance vertical, partnering with top clients to enhance and expand their businesses.
With more than 35 years of experience in the financial services sector and the insurance industry, Mr. Weinem's expertise spans software engineering, financial planning, omnichannel digitalization and transformation strategies, innovation and organizational change management.
Throughout his professional career, he has held various management positions in the banking, financial markets and insurance industry for software solution providers, including Luxoft, Pactera, Capgemini, Cognizant and IBM.
Stephen Holdstock is the Chief Technology Officer of EMEA Insurance at EPAM Systems, where he leads the technological direction for EPAM's insurance clients across the region, helping them achieve strategic value through the integration of business, technology and data.
With more than 20 years of industry experience, Mr. Holdstock brings deep expertise in IT leadership, change management and large-scale transformation programs. His career spans roles in large-scale engineering at Motorola, tier-one consulting at Accenture and strategic leadership at global property and casualty (P&C) carriers, including a significant tenure as CTO at Lloyd's of London.
At EPAM, Mr. Holdstock is focused on building out the insurance practice, continuing to drive transformative outcomes for clients across the insurance industry.
Paige is a vice president, benefits consultant based in Los Angeles, California. She consults on best practices for health and welfare and plan design that help employers control costs and mitigate risk while enhancing employee engagement.
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.
