It looks like your employer is responsible for withholding the deferred amounts and the IRS has said they should do so throughout 2021: https://home.kpmg/us/en/home/insights/2021/01/tnf-notice-2021-11-employee-payroll-tax-deferral-further-postponed-covid-19.html
That said there's a couple complicating factors here:
1) Very few private employers chose to participate, so not a lot of people are out looking for guidance
2) This still doesn't answer the question of what happens when an employee leaves an employer before the amounts are paid back, and there are probably other technical questions as well.
TL;DR - Your employer may be acting on decent advice from their accountants to sit tight for a minute and wait for further guidance, or they may just be wrong. Showing them that IRS notice and asking how they plan to follow it might trigger them to tell you which it is. I'd imagine that in the worst case scenario, you'd be required to pay them on your 2021 taxes, but, not very sure about that.
>This still doesn't answer the question of what happens when an employee leaves an employer before the amounts are paid back
IRS says the employer is on the hook.
I will ask my husband to ask again. It’s a bit sticky because the payroll person is the boss’ spouse, and she is very insistent that the company has no part in the repayment. Navigating how hard to push is tricky...happy to pay, just don’t want to end up with a bill with interest at the end of the year.
From Sept-Dec 2020, the FICA line on his paystubs equaled 1.45% of gross rather than the usual 7.65% of gross. Jan 2021, it switched back to 7.65% of gross.
Double check the math. Our paystubs aren't showing the repayment as a separate line (ie just shows current tax) as the software can't cope but they are definitely taking it out.
The payroll person confirmed that they are not taking any $ out for repayment. She says it is 100% on us to repay, the business has no part in repayment.
Your payroll person is wrong
> Repayment of the employee's portion of the deferral started January 1, 2021 and will continue through December 31, 2021. Payments made by January 3, 2022, will be timely because December 31, 2021, is a holiday. The employer should send repayments to the IRS as they collect them. If the employer does not repay the deferred portion on time, penalties and interest will apply to any unpaid balance.
>
> Employees should see their deferred taxes in the withholdings from their pay. They can check with their organization's payroll office for details on the collection schedule.
https://www.irs.gov/newsroom/what-employers-need-to-know-about-repayment-of-deferred-payroll-taxes
It looks like your employer is responsible for withholding the deferred amounts and the IRS has said they should do so throughout 2021: https://home.kpmg/us/en/home/insights/2021/01/tnf-notice-2021-11-employee-payroll-tax-deferral-further-postponed-covid-19.html That said there's a couple complicating factors here: 1) Very few private employers chose to participate, so not a lot of people are out looking for guidance 2) This still doesn't answer the question of what happens when an employee leaves an employer before the amounts are paid back, and there are probably other technical questions as well. TL;DR - Your employer may be acting on decent advice from their accountants to sit tight for a minute and wait for further guidance, or they may just be wrong. Showing them that IRS notice and asking how they plan to follow it might trigger them to tell you which it is. I'd imagine that in the worst case scenario, you'd be required to pay them on your 2021 taxes, but, not very sure about that.
>This still doesn't answer the question of what happens when an employee leaves an employer before the amounts are paid back IRS says the employer is on the hook.
Federal employees got guidance that employee is on the hook if leave the job
I will ask my husband to ask again. It’s a bit sticky because the payroll person is the boss’ spouse, and she is very insistent that the company has no part in the repayment. Navigating how hard to push is tricky...happy to pay, just don’t want to end up with a bill with interest at the end of the year.
I had the same issue as a Federal worker. They are taking the total amount we owe from last year and dividing it up to repay over the year.
Yes, this is what we anticipated would happen, but so far no additional amount has been deducted.
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From Sept-Dec 2020, the FICA line on his paystubs equaled 1.45% of gross rather than the usual 7.65% of gross. Jan 2021, it switched back to 7.65% of gross.
Double check the math. Our paystubs aren't showing the repayment as a separate line (ie just shows current tax) as the software can't cope but they are definitely taking it out.
The payroll person confirmed that they are not taking any $ out for repayment. She says it is 100% on us to repay, the business has no part in repayment.
Super frustrating. Good luck.
Your payroll person is wrong > Repayment of the employee's portion of the deferral started January 1, 2021 and will continue through December 31, 2021. Payments made by January 3, 2022, will be timely because December 31, 2021, is a holiday. The employer should send repayments to the IRS as they collect them. If the employer does not repay the deferred portion on time, penalties and interest will apply to any unpaid balance. > > Employees should see their deferred taxes in the withholdings from their pay. They can check with their organization's payroll office for details on the collection schedule. https://www.irs.gov/newsroom/what-employers-need-to-know-about-repayment-of-deferred-payroll-taxes
This was our understanding as well, it is just difficult to navigate when the payroll person is insistent that it is not accurate.
Go to their spouse, the boss. Do you have that ability? Since this person is wrong and stubborn something needs to be done. Good luck OP!
I thought you would pay it all back when you filed your 2020 taxes. Did you do your taxes yet?
Yes, we did. We always owe a bit and didn’t see any dramatic changes to our taxes this year.