Payroll tax deferment under Coronavirus Relief
Companies benefitting from P ayroll tax deferment under Coronavirus Relief, Economic Security (CARES) Act know about the IRS's position on deferred tax payment. Even a day of delinquent payment can lead to harsh outcomes. CARES act Section 2302 lets businesses elect for deferring employer social Security tax share on paid wages between 1st April and 31st Dec. 2020. The cash flow for businesses coping with a pandemic, as businesses don’t need a 6.2% Social Security taxes deposit when paid wages were there. Deferred taxes are repaid in two installments: 50% due by 31st Dec 2021, and 50% due by 31st Dec 2022. Large and small businesses take benefit of what is an interest-free government loan. According to IRS PMTA, 2021 memorandum 2021-07 late CARES Act payment of deferred tax makes the whole amount deferred is 10% failure deposit penalty - not the first installment due by 2021 years end. In other words, the first installment late payment of deferred tax is due by the 2021 end an