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Thread: Payroll Tax Holiday

  1. #1
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    Payroll Tax Holiday

    Does a payroll tax holiday mean since I am paying less into the system my benefit will be reduced when I retire?

    I cannot find the answer to this is news coverage of Trump's executive order.

  2. #2
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    YOUR benefit specifically won't be reduced, but even a temporary reduction will cut income into both Social Security and Medicare programs, thus hastening the time when benefits may have to be cut. This is a BAD idea. Both houses of Congress and most Americans are against it.

  3. #3
    Senior Member JaneV2.0's Avatar
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    Business Insider seems to think it's a bad idea:
    https://www.businessinsider.com/trum...ul4AuYtdGeaelU

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    I can remember when they tinkered with the federal withholding table without affecting the ultimate tax liability in the hope the short term jolt might juice the economy. It didnít seem to change anyoneís behavior much.

    If the feds had to produce financial statements using the same accounting standards everyone else uses, the liabilities section of their balance sheet would be staggering.

  5. #5
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    Today's paper....

    trump said the employee portion of the payroll tax would be deferred from Aug 1 through the end of the year. The move would not directly aid unemployed workers, who do not pay the tax when they are jobless, and employees who need to repay the federal government eventually without an act of Congress, where there is bipartisan opposition on Capitol Hill.

    In essence, the deferral is an interest-free loan that would have to be repaid. trump said he will try to get lawmakers to extend it.

    Other places I saw where he is trying to take money from social security and medicare to cover???? Could this be the employer's portion????

    This is from the article posted above...
    Trump's scheme would weaken the Social Security and Medicare trust funds by diverting the revenue from the employee portion of Social Security and Medicare taxes, and potentially the employer's share of Medicare taxes, from the programs' trust funds," the memo from the Center for American Progress said.

  6. #6
    Senior Member bae's Avatar
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    And it doesn't help those of us who don't receive payroll checks and have withholding, but rather pay quarterly.

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    I totally admit I'm a bit confused on this. So, if I don't get the taxes taken out, does that mean I will or won't be libel for them anyway when I file my taxes next April?
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    Senior Member jp1's Avatar
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    The constitution, at least to those of us who actually care about it, is pretty clear that trump doesnít have the power to do this. He, of course, doesnít care. His supporters donít care. Eventually the money will have to be paid back unless congress passes a law about it. Whether said law gets passed is unknowable. In the meantime weíll have chaos because payroll administrators across the country will be asking these same questions. And even with actions like these stupid, not helpful, obviously not legal executive orders that happened this weekend, there are still people who think a Biden presidency will be equivalently bad.

    The remarkable thing is that republicans literally have no ideas beyond tax cuts as the solution to any problem. Maybe someone can explain to me how a payroll tax cut is goi g to help solve the problem that millions and millions of people are without jobs. Those of us fortunate to still have jobs donít need extra money in our pockets.

  9. #9
    Simpleton Alan's Avatar
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    Quote Originally Posted by happystuff View Post
    I totally admit I'm a bit confused on this. So, if I don't get the taxes taken out, does that mean I will or won't be libel for them anyway when I file my taxes next April?
    I believe this is a payroll tax holiday, meaning payroll taxes will temporarily not be deducted from gross payroll. That doesn't mean a tax break, your end of year liability for adjusted gross income taxes remains.
    "Things should be made as simple as possible, but not one bit simpler." ~ Albert Einstein

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