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Level 1

What is the guidelines for the Payroll Tax Holiday?

 
4 Comments
QuickBooks Team

What is the guidelines for the Payroll Tax Holiday?

Welcome to Community, @nmloehr.

 

Let me step in and assist you with your concern. For the guidelines, QuickBooks complies IRS Tax calendar. You can visit this link for more detailed information about IRS Tax Calendar 2020: https://www.irs.gov/publications/p509.

 

Monthly payroll tax depositors must make their tax deposits by the fifteenth of each month. When the fifteenth occurs on a Saturday, a Sunday, or a legal holiday, tax deposits are due on the next business day. A holiday falls on a weekday after the payroll tax liability period and before or on the normal deposit day, extend the deposit due rate one business day for each day holiday.

 

You may also use this article to learn more about tax filing and payment deadlines for 2020:https://quickbooks.intuit.com/small-business/coronavirus/resources/small-business-tax-calendar/.

 

Please know that I'm always around here in the Community to help. Keep safe, and have a great day.

Community Champion

What is the guidelines for the Payroll Tax Holiday?

Until and only then the IRS issues guidance then there is no "tax holiday" and only after the IRS issues such changes to withholding AND Intuit implements such then you must act as if nothing has changed.

 

Even IF there are deferrals offered you might be wise to continue as normal and tell your employees it is in their own best interest to ignore said "tax holiday"

 

1. there is nothing at all anywhere that says this deferral will be or can be forgiven and each employee will owe the balance of the extra 6.2% deferred come January 1, or with their April 1 personal tax return at the latest (my guess)

2. There is a distinct possibility that employers will be on the hook for any deferred withdrawals where the employee is no longer employed with them after the deferral period

3. There is a possibility that the entire deferral must be withheld from first payroll in 2021, which certainly will catch employees by surprise

4. If the deferral is treated as "non-repayable" money then it will have to be treated from an employer view as new payroll amounts that must be grossed up and new deductions made and remitted

 

That is just a few of the pitfalls and it is no wonder that in light of these that NOBODY, either side of teh aisle in Congress was in favor of this poorly thought out memorandum

Level 1

What is the guidelines for the Payroll Tax Holiday?

President Trump has stated that it will be forgiven once he wins the presidency again, which he will.  Telling accountants to ignore this opens them up to legal action.  Once they are sued, I guess they will turn to you for relief.  Good Luck.

Level 1

What is the guidelines for the Payroll Tax Holiday?

Tax law cannot be changed by executive order.  tRump can order the IRS to delay collection, but unless the law is changed, the tax is owed.  Both the House and the Senate would need to pass legislation to "forgive" these taxes. 

 

Since payroll taxes directly fund social security and medicare that millions of retirees depend on, eliminating that tax would end both programs.  Hundreds of millions of workers have paid into the programs for decades, and expect to receive the retirement and medical that we have paid for, so making tRump's gimmick permanent would be a very foolish idea.

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