Businesses Balk at Trump's Payroll Tax Holiday

[alwaysinasnit]

https://www.inc.com/diana-ransom/trump-payroll-tax-holiday-launch-key-issues.html

President Donald Trump's payroll tax holiday for American workers kicked in on September 1, but few if any are likely to see a dime of it. That's because tax and benefits experts are calling the current proposal unworkable.

"It's a nightmare for an employer," says Shauna Zobrist, a CPA and an adviser at Breakaway Bookkeeping & Advising, a virtual network of bookkeepers and accountants in Portland, Oregon. "There are so many unknowns that become apparent when you start peeling back the layers."

That's even after the U.S. Treasury and the Internal Revenue Service on August 28 issued joint guidance on the implementation of Trump's August 8 executive order--which temporarily deferred the employee portion of payroll taxes for workers with annual incomes of $100,000 or less, or $4,000 per biweekly pay period.

The guidance from the two agencies confirmed that employers would be on the hook for repaying the government for any payroll taxes that their employees defer. The businesses in turn are supposed to collect the taxes from their employees. That amounts to 6.2 percent of an employee's salary for Social Security and 1.45 percent for Medicare. The tax can be deferred from September 1 through December 31 of this year and recouped from January 1 through April 30, 2021.

snip...

[lagomorph777]

1. Even more brazenly crooked than Bush's temporary tax cut.

Almost nobody fell for Turd's billionaire tax cut (which was a tax hike for most of us). We're certainly not falling for this crap.

[Wellstone ruled]

4. Which created a major nightmare.

[BlueMTexpat]

2. If they have any sense,

they will ignore this.

It is absolutely ridiculous.

[JHB]

3. Oh, look! It's one of those "unfunded mandates" Republicans used to hate.

Trump waves his magic sharpie suddenly businesses have to figure out how to comply, on short notice, diverting IT resources to reconfigure systems to accommodate this bizarre accounting and potentially open themselves to tax penalties for any errors.

[Cal Carpenter]

5. Yeah, this thing is so messed up

I own a small business - these days it is literally just me and my spouse, and we haven't been able to pay ourselves since March because, well, pandemic. But I was wondering how this was supposed to work, particularly as a "deferral". I use Quickbooks payroll and even they just sent a message a few days ago saying they have no idea how to implement this and are working with the IRS to figure it out.

My question was whether or not the employer's share was being deferred too, or just the employees share (in case folks don't know, we withhold X amount from the employee's paycheck, and pay in an equal share as the employer).

But this is even worse - the employer is not supposed to withhold that money from the paycheck this fall, but then... what? Withhold double from Jan-Apr 2021? Employees will fucking love that, right? Holy shit.

Well, the mechanics of it are a moot point for my business right now, as I said, we have no employees anymore and we can't even pay ourselves (although we probably will in the coming months). But this is a steaming pile of horseshit. Even the major accounting/payroll companies are WTF-ing about it.

[COL Mustard]

6. Federal Employees Are Going To Be Subjected

To this absolute cluster Fock. They don’t have a choice.