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.
Mitch Ocampo is Managing Director and Head of Innovation for RGAX Americas. As the transformation engine of Reinsurance Group of America, Incorporated (RGA) he is focused both on the innovation strategy of RGAX Americas and expanding its capabilities in emerging solutions to better serve clients and solve large-scale industry challenges.
An experienced technology executive, Mitch’s work over the past two decades has taken him to the cutting edge of reinsurance and financial services innovation technology. Since 2015, his primary focus has been insurtech: starting in 2015, he was Chief Technology Officer for reinsurance technology specialist TAI (Tindall Associates), and then, after TAI’s acquisition by LOGiQ3, was Group Chief Technology Officer for LOGiQ3’s companies, which include TAI, APEXA, and Cookhouse Lab. LOGiQ3 was acquired by RGAX in 2017.
Previously, Mitch spent four years as Managing Director, Strategic Industries, Americas, for msg global solutions, a global strategic consulting and intelligent IT solutions specialist. Before then, he was Partner and Managing Director of Kogent Corporation, which builds custom business intelligence, data warehousing and analytics solutions for clients. He has also worked in data solutions and software development/engineering roles for a variety of companies including IBM, EMC, and Thomson Reuters.
Mitch’s Bachelor of Arts (B.A.) is from the University of New Hampshire in Durham, N.H. (U.S.), and holds a dual-degree joint M.B.A. in international business from Brown University, Providence, R.I. (U.S.) and IE Business School, Madrid, Spain.
An active member of the global innovation community, he serves on the advisory board of numerous startups and is a mentor, coach, and advisor to Brown University’s B-Lab accelerator, supporting entrepreneurs developing high impact ventures.
Marc Laliberte is senior security analyst at WatchGuard Technologies.
Isabella Chase is research fellow at the Centre for Financial Crime and Security Studies at RUSI.
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.
