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.
Jen Truscott, senior vice president of Aetna Clinical Solutions, supports CVS Health's strategy to improve access, engagement and connection to care for members and customers. With an almost 30-year career in health care, Jen has worked across customer experience, behavioral health and more, garnering a deep understanding of how health care benefits can support members' holistic health.
Lisa Walsh is the senior vice president, investments, LJW Wealth Management of Raymond James.
For nearly 30 years, she has practiced a holistic approach to personalized planning that addresses the financial complexities inherent in the lives of high net worth individuals and families. She is based in Buffalo, New York.
Wendy Houser is the Chief Wholesale Officer for Markel Specialty, Chair of the Insurance Industry Charitable Foundation (IICF) Board of Governors, and past Chair of the IICF Southeast Division Board of Directors. Houser spent 10 years as a wholesale broker before joining Markel. She was promoted to Regional President in 2014, then served as Chief Territory Officer for the West. She is also a veteran of the U.S. Navy and Navy Reserves.
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.
