The Consolidated Appropriations Aid Act extended the repayment period of deferred employee taxes.  On August 8, 2020, President Trump signed a Presidential Memorandum directing Treasury Secretary Mnuchin to permit the postponement of the withholding, deposit, and payment of the employee’s share of Social Security tax (6.2%), as well as the employee’s share of Railroad Retirement Tax Act (RRTA) Tier 1 taxes on wages and compensation paid from September 1, 2020 through December 31, 2020 for employees whose amount of wages or compensation, payable during any biweekly pay period generally is less than $4,000, or the equivalent amount with respect to other pay periods.

Employers are required to collect and remit the deferred taxes by December 31, 2021 (previously April 30, 2021). If the tax is not paid by this time, penalties and interest will accrue starting January 1, 2022.  If an employee leaves between September 1, 2020 and December 31, 2021 and does not have enough wages in the final paycheck to cover the deferral, employers will have to find another way to collect the tax, or pay it out of their own pockets.