Payroll Tax Suspension to Begin September 1
Many Texans all over the state will see some extra take-home pay beginning in September when the suspension of the payroll tax begins.
It's not a surprise bonus from your boss, it's just the portion of your income that is usually withheld by your employer as income tax. That money will no longer be withheld and could add around $100 dollars to an employee's monthly income, or around $50 extra dollars per paycheck if you are on a bi-weekly pay schedule.
While the legality of suspending of the payroll tax continues to be debated in Washington, President Trump decided to include the measure as part of his executive order for COVID-19 relief.
One thing to keep an eye out for will be if a decision is made to pay back the withheld tax? Who will have to repay it? Will they ask employers to add the money back? The suspension of the payroll tax means significantly less money going into the social security fund. An estimated $139 billion less.
ABC13.com spoke with Certified Public Accountant Ed Gardner who said, "Under (Pres. Trump's) executive order, they could potentially and would have to pay back the FICA that they saved, but he has instructed the Secretary of Treasury to look to see if there is a way to do away with that."