COVID Tax Changes

https://www.irs.gov/businesses/small-businesses-self-employed/self-employment-tax-social-security-and-medicare-taxes

By Catch on
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Please note: These changes were for 2020 income taxes only. Congress may take additional steps on this topic later this year. We will update this page with details as the become available. ‍

Tax Day Change

Every year, Americans file their taxes by April 15th. This year, the IRS has pushed the tax filing deadline to July 15 to allow more time to complete your tax return. If you feel you will need more time than that, you should talk to an accountant or tax professional about filing an extension.

Deferral of Payroll Taxes

Payroll taxes are Social Security and Medicare taxes, but do not include Federal or State income taxes. Payroll taxes are paid partially by the employer and partially by the employee. Self-employed people, however, are responsible for paying both portions of these taxes.

The recently passed CARES Act allows the employer portion (50%) of payroll taxes owed in 2020 to be deferred. The deferred amount may be paid in equal amounts by the end of 2021 and 2022.

While this does not eliminate the payroll taxes due, it does take the pressure off of small business owners and self-employed individuals by allowing them to pay over time.‍

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