Employee Payroll Tax Deferral & PPP Update
Hagan, Tucker, Schmitt & Gintz Business Partners:
Employee Payroll Tax Deferral
We wanted to take a moment and address the Presidential Memorandum issued August 8, 2020 that allows employers to defer withholding and payment of the employee's portion of the Social Security tax if the employee's wages are below a certain amount.
Employers can choose to offer this deferral or not.
Employer is responsible for payment of the deferred amounts.
Deferral of employee portion of Social Security taxes (6.2%)
There are many questions we are awaiting answers to, the major one being: will this eventually move to being a forgiven amount? Until we see additional guidance released we would advise our clients not to offer this deferral at this time. We will continue to send updates as they are released.
Things are still unclear regarding PPP Loan Forgiveness. Though we have some guidance, there are still many questions without answers. Here is a brief update according to what we know now.
We are uniquely positioned to assist our clients with the application of forgiveness, as well as business modeling, cash flow/break even analysis and assessment for other loan assistance for those who continue to struggle. "PPP2" could be coming, although with a much narrower focus for those experiencing severe declines in revenue. We are happy to help our clients in any way we can.
Please contact us with additional questions and concerns.
Thank you for your continued trust and relationship with our firm.
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Hagan, Tucker, Schmitt & Gintz LLC