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does this new payroll tax thing affect our pay?
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 Financial Discussion
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A family member who works at the V.A., which uses DFAS as their payroll processor, just received a notice that beginning next pay period, no payroll taxes (Social Security and Medicare) will be taken out of V.A. paychecks through the end of this year. It also says that double payroll taxes will be taken out Jan-April 2021. There is no opt-out.
Since DOD also uses DFAS as its payroll processor, I believe this will also happen with DOD paychecks. Not sure about the military, but definitely Civilians. I am DOD, have not seen a notice yet. I emailed our Comptroller about it, but no answer yet.
This is a big mess. It will put some in a higher tax bracket for 2020 and be a big hit to paychecks for the first 4 months of 2021. In addition to bankrupting Social Security and Medicare, of course.
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Originally Posted by: SD Analyst  A family member who works at the V.A., which uses DFAS as their payroll processor, just received a notice that beginning next pay period, no payroll taxes (Social Security and Medicare) will be taken out of V.A. paychecks through the end of this year. It also says that double payroll taxes will be taken out Jan-April 2021. There is no opt-out.
Since DOD also uses DFAS as its payroll processor, I believe this will also happen with DOD paychecks. Not sure about the military, but definitely Civilians. I am DOD, have not seen a notice yet. I emailed our Comptroller about it, but no answer yet.
This is a big mess. It will put some in a higher tax bracket for 2020 and be a big hit to paychecks for the first 4 months of 2021. In addition to bankrupting Social Security and Medicare, of course. I agree it's a mess. I assume the V.A. is just doing it for the those employees making less than $4,000 bi-weekly, as that was a part of the order: "The deferral shall be made available with respect to any employee the amount of whose wages or compensation, as applicable, payable during any bi-weekly pay period generally is less than $4,000, calculated on a pre-tax basis, or the equivalent amount with respect to other pay periods." Out of curiosity, how would this push someone into a higher tax bracket? I don't think payroll taxes taken are excluded from gross income for federal tax purposes, so that should remain unchanged. Only take home pay will be affected. The big issue will be the ability to repay the deferred amount in 2021. I just don't see the benefit to people, unless there is an assumption that the deferred amounts will be made permanent (not taken back) through legislation at some point.
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I think that's suppose to be the allure of voting for Trump.
Vote for him and he'll make it so you wouldn't have to repay those deferred monies.
Vote for Biden and who knows what he's going to do.
Trump is probably hoping that people will think "Biden is going to keep my tax money and not give it back".
There aren't too many politicians who are eager to give money back especially if that politician wants to raise taxes by $4 trillion. |
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Originally Posted by: GordonG I think that's suppose to be the allure of voting for Trump.
Vote for him and he'll make it so you wouldn't have to repay those deferred monies.
Vote for Biden and who knows what he's going to do.
Trump is probably hoping that people will think "Biden is going to keep my tax money and not give it back".
There aren't too many politicians who are eager to give money back especially if that politician wants to raise taxes by $4 trillion. Thing is, if Trump wins and Dems keep the House, there is ZERO chance a Bill gets passed to forgive the underwithholding. The ONLY way this has any chance of forgiveness is if everything is under one Party.
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well, DHS Office of the Under Secretary for Management just sent an email out that says they are working on the deferrals and they may get processed this month. No real difference as end results than the other posted letters.
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Originally Posted by: SD Analyst A family member who works at the V.A., which uses DFAS as their payroll processor, just received a notice that beginning next pay period, no payroll taxes (Social Security and Medicare) will be taken out of V.A. paychecks through the end of this year. It also says that double payroll taxes will be taken out Jan-April 2021. There is no opt-out.
Since DOD also uses DFAS as its payroll processor, I believe this will also happen with DOD paychecks. Not sure about the military, but definitely Civilians. I am DOD, have not seen a notice yet. I emailed our Comptroller about it, but no answer yet.
This is a big mess. It will put some in a higher tax bracket for 2020 and be a big hit to paychecks for the first 4 months of 2021. In addition to bankrupting Social Security and Medicare, of course. it's not going to affect anyone's tax bracket for 2020. FICA taxes are not tax deductions.
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Trump thinks this gives him leverage and he has nothing to lose at this point. Why not completely politicize the government and use workers as pawns at the bargaining table? It is a wild shot in the dark for the hope he can get re-elected. Don’t worry things will get stranger yet. Edited by user Thursday, September 10, 2020 11:03:20 AM(UTC)
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does this new payroll tax thing affect our pay?
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