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Message
re: Trump's EO to defer payroll tax
Posted on 8/8/20 at 9:37 pm to TimeOutdoors
Posted on 8/8/20 at 9:37 pm to TimeOutdoors
From Bloomberg
quote:
His other major action could potentially have a bigger impact: it defers the payroll tax from September through year-end for workers earning as much as $8,000 a month, which could put an extra $600, at most, in employees’ pockets. Economist Stephen Moore, a Trump ally, says it amounts to a $300 billion tax cut that would help the economy.
This post was edited on 8/8/20 at 9:41 pm
Posted on 8/8/20 at 10:08 pm to TimeOutdoors
quote:
I heard 100k cutoff and I heard 137k. I’m assuming this is 100k pre-tax. Seen anything official?
It’s $104,000 and it’s pre-tax. Yes, I have seen something official.
Memorandum on Deferring Payroll
Posted on 8/8/20 at 10:26 pm to Northwestern tiger
quote:
which could put an extra $600, at most, in employees’ pockets.
*per month
Which would be ~$2,400 over the 4 months.
Posted on 8/8/20 at 11:44 pm to Northwestern tiger
How does this affect me as a 1099 employee, will my taxes be lower when I file for 2020?
Posted on 8/9/20 at 6:28 am to Northwestern tiger
What if you have a pension and don’t pay into SS?
Posted on 8/9/20 at 6:54 am to PrideofTheSEC
It does nothing for you
Posted on 8/9/20 at 7:02 am to BilJ
Is it on the first $104k or just for those that make less than $104k?
Posted on 8/9/20 at 7:16 am to yellowfin
quote:
I guess those with pensions that don’t pay SS are out of luck
No sympathy here
Posted on 8/9/20 at 8:48 am to go ta hell ole miss
quote:hopefully he succeeds. otherwise, this sounds like a disaster with a bunch a people owing money they can't pay.
y. The President does have the power delay tax collections, which he did here. He will move to have them forgiven if re-elected.
Posted on 8/9/20 at 9:07 am to PrideofTheSEC
quote:
How does this affect me as a 1099 employee
1099 is not an employee. W2 is an employee.
I write myself a W2 salary as an employee of my corporation.
I pay SS and medicare through payroll taxes. You pay it through self-employment taxes as a sole proprietor.
Posted on 8/9/20 at 11:06 am to Fat Bastard
For those of us taxed as s-Corp with a modest salary and takes distributions.... is there any benefit to this? Doesn’t seem like it.
Posted on 8/9/20 at 11:24 am to Fat Bastard
So will this lower the self-employment tax?
Posted on 8/9/20 at 11:35 am to Northwestern tiger
quote:
"A person who makes 40K a year will make $3000 extra and at the same time will be $3000 cheaper for the employer".
I thought it was only the employee-side payroll taxes being deferred?
I’m not sure how I feel about this. For starters, the ambiguity around whether the deferred taxes will be forgiven seems problematic. If employers decide not to withhold these taxes and they are not forgiven, whose tax liability does it become? If the employers are the ones who will ultimately have to pay, it seems likely that they would still withhold those taxes anyway.
And then there’s the question of how much good this does in the grand scheme of things. When all of the talk about payroll tax cuts came up, I assumed the idea was to reduce cost for employers so that they would have an incentive to hire back more of their workforce. But an employee-side cut does nothing to reduce the employer’s cost unless there’s a corresponding reduction in wages. Which feels like an odd thing to incentivize.
So it might reduce the economic impact for folks who are still working but took salary reductions. But unemployment/furloughs are the larger problem right now. Sure, maybe a lot of companies do pass these savings in to their workers and maybe those workers go spend enough extra money to impact demand in a meaningful way. It just feels like a really inefficient way to stimulate the economy.
Posted on 8/9/20 at 11:57 am to Janky
quote:
Is it on the first $104k or just for those that make less than $104k?
Nobody knows. There is some serious confusion about this and the press isn’t covering it because “rich people”.
When I first read it, it sounded like it only affects paychecks less than 4000 but it sounds mighty sketch to not apply to just 4000 no matter what.
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