The executive order of deferring payroll taxes for workers and employers was implemented in August of 2020, but you may be wondering how that impacts 2022 and 2023.
The repayment of an employee’s portion of the tax deferral began January 1, 2021, and continues through January 3, 2023. Employers must repay the entire deferred amounts regardless of whether an employee is still employed. Employees and self-employed individuals had the option to pay the employer’s share of the eligible Social Security tax liability, normally 6.2% of the wages. Half of that deferral was due January 3, 2022, and the other half will be due on January 3, 2023.
All employers should be sending their repayments to the IRS as they have been collecting them. If these deferred payments weren’t paid on time, interest and penalties were and will be applied to any outstanding balance. Employer deferral payments can be made through the Electronic Federal Tax Payment System or by credit/debit cards, money orders and even checks. Visit the IRS website to make your payment online at https://www.irs.gov/payments or https://www.eftps.com/eftps/. Be sure to keep these payments separate from other payments so they will be applied correctly to the deferred payroll tax balance.
If you have any questions, please contact our office at 716-720-5339 or email Janine Anderson at janine@gleasontaxadvisory.com.
Article Updated January 2022
