Recently President Trump issued an executive order authorizing employers to defer the withholdings, deposits, and payments of certain payroll taxes from Sept. 1 through Dec. 31. This is only a deferral — not forgiveness of the tax owed.
If Ithaca College were to opt into the Payroll Tax Deferral for employee withholding, this would mean that certain employees would see a temporary boost in their take-home pay for the reminder of the calendar year. However, those taxes owed would need to be withheld beginning in January 1, 2021 to pay the deferred amount to the IRS, so then employees will see significantly smaller paychecks early next year.
Due to the complexities involved with this directive and the negative impact on take-home pay for employees in 2021, Ithaca College will NOT be implementing the deferral of employee withholding. By not “opting in” to the Payroll Tax Deferral, employees’ payroll taxes will remain consistent, as normal. Should there be additional legal actions that result in forgiveness of these payroll taxes during 2020, employees would be able to claim those on the 2020 tax return.
If you have any questions regarding the Payroll Tax Deferral or your paycheck, please email payroll@ithaca.edu.
https://www.ithaca.edu/intercom/article.php/20200902160737852