Summary of Delay of Payment of Employer Payroll Taxes (§ 2302)

Below is a summary of one of the provisions of Title II - Rebates and Other Individual Provisions and Business Provisions from the Coronavirus Aid, Relief and Economic Security Act (CARES Act).
 

Summary and Analysis

• The CARES Act provides that employers (including self-employed individuals) may defer their portion of the social security taxes otherwise due on wages paid (which is generally 6.2%), starting on the effective date of the CARES Act through the end of the 2020 calendar year.
• Under this provision, employers will still be responsible for paying their portion of the Medicare Tax (which is 1.45%).
• The deferred amounts can be paid in two equal installments, the first of which is due on December 31, 2021 and the second of which is due on December 31, 2022. 
• Employers who have Small Business Administration loans forgiven under Section 1109 of the CARES Act will not be eligible for this deferral.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.