On Saturday, August 8, 2020, President Trump signed an Executive Order which directs Treasury Secretary Mnuchin to defer withholding, deposit, and payment of the tax imposed by 26 U.S.C. §3101(a), and much of the tax imposed by 26 U.S.C. §3201, as is attributable to the rate in effect under 26 U.S.C. §3101(a), on wages or compensation, as applicable, paid during the period of September 1, 2020, through December 31, 2020. To read the full order, click here.
The AICPA has requested guidance from the Treasury Department and the IRS on the payroll tax deferral, and Sage is monitoring this closely. To learn more about the guidance request, click here.
We are waiting on guidance and clarifications from the Treasury Department and the IRS before determining our next steps.
UPDATE: As of today, August 25th, the IRS has not released any guidance for this payroll tax deferral.
Additionally, the National Payroll Reporting Consortium (NPRC) and American Payroll Association (APA) have sent recommendations to Treasury and IRS. To learn more about these, click NPRC Statement on Employee Social Security Tax Deferral and NPRC and APA Offer Recommendations to Treasury and IRS re Social Security Tax Deferrals
We are continuing to monitor this closely.
This post will be updated when more information is known.
Gina - it looks like the IRS has issued something late Friday. The Journal of Accountancy published an article putting it in plain speak. Looking forward to guidance on how to process in Sage 100.
UPDATE: Guidance for the recent Executive Order was received late Friday. Sage is reviewing to determine next steps. Read about the guidance here: https://www.irs.gov/pub/irs-drop/n-20-65.pdf
We are aware that the IRS posted a draft revision of Form 941 and we are reviewing it as well. The Form 941 draft is posted here: https://www.irs.gov/pub/irs-dft/f941--dft.pdf.
There remains significant confusion surrounding this issue. Some political pundits claim the President’s Memo is a political strategy designed to force a more comprehensive deal on economic reforms and stimulus with Congress upsers portal
I have clients calling asking about how to handle this. Especially Union shops!!