The President recently signed an Executive Order related to COVID-19. The Executive Order directs the Treasury Department to defer the 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.
We are waiting for guidance and clarifications from the Treasury before determining our next steps.
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Since Sept. 1st is tomorrow, what is the best course of action for those who have to run payroll this week?
I have Payroll on 9-4 and I'm not changing anything at this point. It's so convoluted and confusing, I'm just going to play it safe and withhold as usual.
Since Treasury guidance says the employer is ultimately responsible for making sure the deferred taxes are repaid I am not going to participate. No guidance issued if an employee is no longer with the company next year. This is not mandatory that the employers participate in this deferral program.