The following FAQs address the Presidential Memorandum titled, "Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster" issued by the President on August 8, 2020 ("Memo"). These FAQs are based upon the Memo, as well as information and guidance issued by the Treasury Department Internal Revenue Service as of September 2, 2020, including Notice 2020-65. We will continue to update these FAQs as we receive additional guidance from the Treasury Department and Internal Revenue Service.
FAQ #1: What is the Payroll Tax Deferral Memo? 2
FAQ #2: Which workers are eligible? 2
FAQ #3: When does the program become effective? When does it end? 2
FAQ #4: Are employers required to stop withholding employee payroll taxes? 2
FAQ #5: If any employer does not participate in the deferral program, should they continue to withhold and deposit on their normal schedule? 2
FAQ #6: For employers who decide to participate, when do the deferred taxes need to be repaid? 2
FAQ #7: Will there be additional guidance on this program? 3
FAQ #8: Will the tax deferrals be forgiven? 3
FAQ #9: If an employer chooses not to defer the withholdings, do employees have a claim against the employer? 3
FAQ #10: If an employer chooses not to participate, and gets push back from their employees, are there any benefits to employees by not participating that an employer could cite? 3
FAQ #11: If an employer chooses to participate in the deferral, can an employee demand that the employer continue to withhold their taxes? 4
FAQ #12: Are there consequences for failing to remit all deferred taxes by April 30, 2021? 4
FAQ #13: What if an employer defers the payroll taxes, but then later an employee for whom such taxes were deferred is terminated prior to repaying all deferred taxes?
Download here: Payroll Tax Deferral FAQs re: 9-4-2020