In a recent memorandum, President Trump has directed the Secretary of the Treasury to use his authority under IRC Sec. 7508A to defer certain payroll tax obligations with respect to certain American workers. The Secretary may defer the withholding, deposit, and payment of the 6.2% Social Security tax imposed under IRC Sec. 3101(a), as well as the 6.2% railroad retirement tax under IRC Sec. 3201, on wages or compensation paid 9/1/20 through 12/31/20.
The deferral shall be made to any employee whose wages or compensation, payable during any biweekly pay period, generally is less than $4,000 (calculated on a pretax basis). The memo also directs the Secretary to explore avenues, including legislation, to eliminate the obligation to pay the deferred taxes.