As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the IRS is providing employers with a deferral of certain employer tax deposits and payments.
What can be deferred?
The deposits and payments for the
employers portion of the social security tax (6.2%) can be deferred beginning March 27, 2020 and ending on December 31, 2020.
Who is eligible to take advantage of this program?
All employers may take advantage of the deferral program. Employers who are participating in the PPP loan program may only defer their payments until the date which the loan is forgiven.
Can I take advantage of these deferrals in addition to the sick pay, child care leave and employee retention tax credits?
Yes, qualifying employers may take advantage of both (a) the social security employer tax payment deferrals discussed above and (b) the tax credits related to employee sick leave, child care leave and employee retention tax credits as provided for in the Families First Coronavirus Relief Act.
When do the deferred taxes need to be paid back?
Under this program, 50% of the deferral is due on or before December 31, 2021 and the remainder due on or before December 31, 2022.
Are self-employed individuals eligible to defer payments?
Yes, self-employed individuals may defer 50% of the social security tax on net earnings from self-employment income beginning March 27, 2020.
Where can I find more information on this program
Please contact our office with any questions.