Tags: payroll tax deferral | military | dod | dfas

Military Personnel Automatically Subjected to Trump's Payroll Tax Deferral

trump in a suit and red tie walking on the wh lawn
President Donald Trump (Tasos Katopodis/Getty Images)

By    |   Tuesday, 08 September 2020 02:24 PM EDT

Military members will not be able to opt out of President Donald Trump’s payroll tax deferral, The Hill reports.

The payroll services provider for the Department of Defense said all military personnel will be enrolled in the deferral program. 

"Military members are not eligible to opt-out of the deferral if their Social Security wages fall within the stated limits," the Defense Finance and Accounting Service, or DFAS, said on its website. "The deferral will happen automatically."

Last month, Trump signed a memo directing the Treasury Department to allow employers to defer payment of employee-side Social Security payroll taxes. The goal is to allow workers to keep more money in their pockets amid the coronavirus pandemic.

Under IRS guidance implementing the order, employers can stop withholding the 6.2% Social Security tax from Sept. 1 through Dec. 31 for workers who make less than $4,000 biweekly. Employers can then recoup the money by increasing the amount withheld from workers' paychecks in the first few months of next year.

While the federal government will participate in the deferral program, many private businesses have said they won’t implement the program. Many employers have raised concerns about shorting their employees’ paychecks when the deferral period ends.

Military members will begin to see a change in their pay in the middle of the month.

DFAS said the Social Security tax deferral will apply to service members whose monthly rate of basic pay is less than $8,666.66. The payroll provider said any deferred taxes would be collected from wages between Jan. 1 and April 30.

According to DFAS, the payroll tax deferral will also be mandatory for civilian Defense Department employees whose wages are below $4,000 in a given biweekly pay period.

Some Democrat lawmakers and unions have taken issue with the mandatory deferral for federal employees.

"The President’s order will give the illusion of pay increases until after the election, and then require service members to pay the money back with double tax withholding," Rep. Don Beyer, D-Va., said in a statement Monday. "This is a disgraceful way to treat those who serve and sacrifice to keep us safe, and Trump’s trickery is obviously designed to help his campaign."

Beyer is co-sponsoring legislation that Rep. John Larson, D-Conn., recently introduced that would block the payroll tax deferral.

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Politics
Military members will not be able to opt out of President Donald Trump's payroll tax deferral, The Hill reports. The payroll services provider for the Department of Defense said all military...
payroll tax deferral, military, dod, dfas
382
2020-24-08
Tuesday, 08 September 2020 02:24 PM
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