IMPORTANT PAYROLL TAX DEFERRAL INFORMATION
President Trump signed an Executive Order (EO) that will defer payroll taxes for all federal employees making $104,000 or less annually, effective next pay-check. There is NO OPT OUT OPTION! This affects 1.3 million federal employees...including VA employees. You will see a temporary boost in your paycheck, but BEWARE, you will have to pay this all back in the new year and if you are delayed there will be penalties and interest charges! AFGE Local 2110 recommends you put the extra money you receive now aside (6.2% tax deferred dollars) so that you have it when your tax bill comes due and can avoid any penalties and interest charges.
Here’s why Trump’s Social Security Tax Scam is a bad idea:
Employees will be stuck with a large tax bill at the end of the deferral period.
You will have to pay double your tax rate during the first 4 months of 2021.
If you can’t pay it back, you are on the hook for interest fees and penalties.
Your paychecks will be smaller next year due to a new tax liability.
This action is not meaningful relief from COVID-19, just a deferred tax bill with potentially disastrous effects.
AFGE nationally is fighting to make this an optional tax deferral, but as of now the Executive Order does not give you the opt out option