The Office of Human Resources addresses questions regarding the "payroll tax holiday" or "payroll tax deferral.'
On Aug. 28, 2020, the IRS issued Notice 2020-65, allowing employers to determine whether to temporarily defer withholding the employee's portion of Social Security payroll taxes as directed by an Executive Order issued by President Donald Trump.
Under the IRS guidance, employers who elect to participate, would stop withholding the 6.2 percent Social Security tax for pay periods Sept. 1 - Dec. 31, 2020. Since this is only a deferral, employees would have to repay the taxes which would result in doubling the employee's Social Security tax paycheck withholding to 12.4 percent Jan.- April 2021.
After evaluation and consideration of the IRS guidance, as well as conferring with other IHL institutions and hearing from several employees, The W has opted out and will not be deferring the withholding due to the fact it would cause employees to experience a double withholding in 2021 to recover the taxes due. In addition, if an employee leaves The W before the deferred tax is collected, the employee would be required to pay the amount owed.
Human resources will continue to monitor guidance offered by the IRS as it relates to the President's Executive Order and will keep campus informed if there are any changes to an employee's withholdings. Please let HR know if you have any questions or concerns.
October is open enrollment and the time to make changes to your benefits effective Jan. 1, 2021 Employees will receive an email the week of Sept. 28 with detailed instructions on how to make changes to benefits. All changes must be submitted by 1:00 pm on Oct. 31, 2020.
Review open enrollment information at the following link: https://www.muw.edu/images/admin/admin/hr/current/2021OpenEnrollment.pdf