Delay of Employer Payroll Taxes
Small business owners normally had to collect 6.2% of their employees' wages for Social Security Tax as part of the FICA withholding up to a maximum wage base limit then match each employee's contribution as part of their payroll taxes. However, the Coronavirus Aid, Relief, and Economic Security (CARES) Act allows employers (and self-employed individuals), to defer paying their portion of the social security payroll tax (6.2%) through the end of 2020. The deferred amounts will ultimately have to be paid to the U.S. Treasury in two installments, half of the deferred amount of payroll taxes from 2020 will be due in Dec. 31, 2021 and the rest of the amount due in Dec. 31, 2022. This deferral of payroll taxes will not apply to anyone that has had indebtedness forgiven under the CARES Act. This provision applies to periods beginning on the date of enactment of the CARES Act. If you need help or like to know more, please contact us today!