Trump Administration Allows Deferral of Social Security Tax

[appalachiablue]

Source: AP News

By Ricardo Alsonso- Zaldivar, 2 hours ago.

WASHINGTON (AP) — The Trump administration on Friday allowed employers to suspend collection of some Social Security taxes, although business groups don’t like the idea and it may create political headaches for Republicans. Democrats are already saying it would undermine retirement benefits.

The Treasury Department guidance came late in the day, less than 24 hours after the conclusion of the Republican National Convention and a speech by President Donald Trump in which he promised to protect Social Security and Medicare.

It allows employers to offer their workers a temporary deferral of the 6.2% payroll tax employees pay into the Social Security Trust Fund for the rest of this year. The taxes owed would not be forgiven, and instead would come due in 2021.

Trump had ordered the tax deferral in early August after Congress deadlocked on the latest coronavirus relief bill. The president argues more money in workers’ pockets for the rest of this year will translate to a boost for the economy...



Read more: https://apnews.com/9c14eb40be1ab40735f983b512475d8d

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Leading business groups typically allied with the WH called the idea unworkable for employers & unfair to workers. Employers wanted to avoid the hassle of having to collect the deferred taxes later on from their workers.

Neil Bradley with the U.S. Chamber of Commerce, said the Treasury guidance leaves many practical questions unanswered. “However, it makes clear that employees will be required to pay more taxes beginning in January, to offset any benefit they receive now,” “The only way to achieve a workable proposal is for Congress & the administration to come together and enact a change in the law.”

Lawmakers have little desire to tinker with Social Security. Separately, AARP wrote Treasury Secretary Steven Mnuchin to express concerns about the potential consequences for Social Security finances.

[RazzleCat]

1. Then we run out of SS in 2023, if permanent, or employees get a huge tax bill in 2021

Payments for Social Security benefits will end by the middle of 2023 if President Donald Trump were able to deliver on his promise of permanently cutting payroll taxes, and if another funding source was not provided to replace it, according to an estimate from the chief actuary of the Social Security Administration.

https://www.forbes.com/sites/nicholasreimann/2020/08/24/social-security-fund-would-be-empty-by-2023-if-payroll-taxes-were-cut-actuary-estimates/#5251e5b8a3b2

[appalachiablue]

5. Tx for the Forbes article, this is what I've been reading

about the issue recently as well. It's ominous..

(A bit of Starkist Tuna once in a while, but I distain cat food).

[Born Free]

31. ominous...

Trump & Republicans accuse Biden of wanting to defund police the same time Trump proposes to defund Medicare & Social Security during a time when senior citizens are under attack, facing a real threat of dying from Covid-19. Scare the old people from the boogieman while you let them die from an invisible killer pandemic. In the end someone will have to pay the price for Trump's incompetence and it's looks like they are putting it on the back of seniors.

[Bengus81]

24. Social Security payments would be met for another 12 years without a dime going in?

I call 100% BULLSHIT. If that was even in the realm or reality then the only way would be start reducing payment starting in Feb 2021. Soon enough SS payments would be HALF of what they are now, then 2/3rds less and on and on. Medicare will disappear too, possibly before SS goes broke.

Telling me all those millions of seniors living in Florida are going to pull a lever for Trump again??

[TreasonousBastard]

2. This has to be, bar none, the stupidest and meanest idea they have had. 6.2% more in your...

pocket now vs 12.4% less after January. (And the election!)

And what about Medicare taxes? And does this apply to the employer's contribution, too?

As crass and cynical as it gets.

[not fooled]

28. Perhaps getting another tax cut for employers

is the goal. A twofer--destroying Social Security and giving corporations another big tax break.

[sprinkleeninow]

3. 'Pulling' this, huh? n/t

[TeamPooka]

4. start making the tv ads now! Trump is killing Social Security

[cstanleytech]

6. Translation: Its a gimmick to feed the voters a line of bullshit in order to sway them before the

election that he is giving them back money that the federal government would have taken but come next year anyone that falls for it will be facing a nasty tax bill.

[bubbazero]

7. dear Donald,

Listen Up Sparky, You FUCK with social security at your peril. This WILL turn normally neutral, and even a few Republican leaning groups against you. (Rural groups like Farm Bureau for instance.) Donald, if you think the NRA was possessing some political clout, you will find retiree groups such as AARP to be a FORMIDABLE ADVERSARY. (I would not want the 'Blue Hair Brigades' AGAINST me if I were running as either Democrat, or Republican) For every one person you fool with this BULLSHIT, you will anger at least 2 more-(some of whom are-or were- planning on voting Republican). Your desperation is showing as well as your stupidity. Dude, Your ASS IS DRAGGING ON THE GROUND!

[Mr.Bill]

8. It's becoming clear they are planning

to do some very nasty things leading up to and on November 3rd. They are not planning on a fair election. They can't win one and they know it.

[C Moon]

12. Everything they are doing from here on out is to steal the next election.

And I believe they will succeed. How can you fight the lawless, when the law won't fight back?
Our constitution is dust.
I think we'll see Russian soldiers on our soil in 2021.

[NYC Liberal]

9. Either Trump loses so the big tax bill will come due when Biden is president,

in which case the Republicans will say Democrats "raised taxes".

Or Trump wins, but he won't care because he's term-limited.

[not fooled]

11. If he "wins" "again" he will permanently abolish the payroll tax

and in so doing accomplish another puke wet dream, the destruction of the most successful and popular government program in history.

What a bunch of fuckers.

[onetexan]

27. i think this is a floater. Not going to work. Federal employees would be way too stupid to be stuck

with a fat bill when it comes due so deferring is a bad bad idea. Plus it would mean payroll system changes that would not be easy to implement. The damn administration is grasping at straws. Once Biden is president the whole sham is DOA.

[Karadeniz]

10. It is not proper, in a democracy or a representative govt, for one person to dictate what

Happens to the citizens' pensions, which they have funded, or retirement health insurance or disability insurance. This sort of power should not exist.

[flamin lib]

13. I know a few people who had the opportunity to hide income from withholding taxes.

It was largely cash income and some of it was really quit large.

It bit all of them in the ass when they got old. One was a few quarters short of being able to take SSDI when he became permanently disabled by epilepsy so he's left with Medicare which isn't anywhere close to SSDI and he'll probably die before he's old enough to collect actual SS. Another is living in an RV and working as an RV park manager in his 80s because his SS is way short of what he would have had if he'd have just paid the 7.5% of the $150k a year he hid.

Now the Republicans want to do that for everybody.

[BlueMTexpat]

14. If they're smart at all,

they won't do a thing until the election results are in.

And please heaven, may Biden-Harris win!

[SunSeeker]

15. Do people realize Trump is defunding Social Security?

[pazzyanne]

18. No, and they laugh when you try to explain it to them.

The Republicans in my world that I have tried to tell that this is the long term goal of the president brush it off. When you talk about FICA as the payroll tax that funds Social Security and Medicare, they tune you out. These people are on Social Security and Medicare, but they just don't want to understand. Magical thinking - ugh! Reminds me of tRump and the coronavirus. You can not fix stupid.

[abqtommy]

20. Defund tRUMP, not Social Security! And tRUMP snivels that nobody likes him?

[appalachiablue]

32. I don't think they do, and many won't, even if ads

are quickly made up and blasted across TV, papers and the internet. But I hope I'm wrong, dead wrong.

Seniors in Fla., Arizona and many others esp. on Disability who depend on these programs care for sure.

The right has been after this for years, since FDR founded the life saver SS program in Aug. 1935 during the Depression to keep old people off the streets and from destitution. This is the 85th anniversary. And LBJ, bless him implemented Medicare and Medicaid.

I'm concerned it's not only non readers and the politically illiterate who won't be reached and convinced, but also other people who are complacent and distracted by their lives and activities. I know a few who are busy with final years to retirement and enjoying grandkids which is great, but... At least Rachel Maddow & some others a few years ago kept emphasizing just 'lift the cap.'

The Simpson-Bowles 'catfood commission' media tour under Obama was puzzling but effective. I hope and think it was a ploy by Dems. to maintain other balances. Around 2011, when I saw a panel with Sen. Mark Warner (D-VA) say emphatically, 'if we don't do something about these 'entitlements'-- it's 'Katy bar the door'! I was floored. Maybe he did it to go along then, so to speak.

Reminds me of how unions were killed esp. in the big Reagan years and even I didn't realize how much at the time.
Now the sabotaged USPS could be on its last legs, not just for election purposes, but also from so much online merch delivery via FedEx and other cos.

Bush II's move in the 2000s to pre-fund postal employee retirements 75 years in advance, for people not even born yet was a life blow. The service lost some funding as intended. Afterwards its been, it's 'failing' and has to be privatized. Ruthless.

Many young people have been inundated with how SS won't be there for them, which is partly true I guess, esp. if this flies. One would think they'd get involved since they will be likely responsible for the care and support of 'parents in need.'

I brought this up with a few Boomer friends several years ago- smart Dems, educators, govt. employees who are NOT RICH. But it was surprising how blase they were and rather accepting of SS's impending 'demise.' I think they've also been conditioned by media and campaigns. One who has been a friend from HS I lost a lot of regard for over this issue. She's more aware I thought, and is, on certain other issues.
-----------
Where is AARP, as people have brought up recently. They should be all over this immmediately with a massive campaign. But are they really an advocacy group, and for this major issue?

As I'd heard several years back from some in media, and just recently checked, AARP was founded in the 70s mainly as a life insurance promoting organization and heavily into marketing-- products, lifestyles, etc. I pray they still come thru, and it better be soon and strong with their large membership. Jesus!

[safeinOhio]

16. He is right about one thing.

Those that are working and getting a pay check can't make it without a living wage. He needs to make $15/hr the new law, not a loan.

[SergeStorms]

17. Oh no! Not a sternly worded letter from the AARP!

Mnuchin must be shaking in his $2,000 loafers.

[pazzyanne]

19. Just my opinion, but you do not want to mess with the members of AARP.

They are informed and a strong voting bloc that understand what the POS in the White House is trying to sell. tRump will ignore them at his peril.

[crickets]

30. I agree.

Social Security is a political third rail. trump is standing on it to his own peril. Businesses may have different reasons for being hesitant, but it speak volumes they are not immediately falling in line with the idea.

[gab13by13]

21. First question,

is Trump allowed to do this because he is claiming it's just a deferral?
They are all demons. Trump doesn't think these things up on his own. I'm sure that Mnuchin and Kudlow are pushing this. My daughter is 45 years old and is planning for a retirement without Social Security.

[AZ8theist]

26. Yes, it has to be a deferral. Doturd cannot change tax law unilaterally.

The REAL problem is next year if he gets re-elected. He can continue to defer the tax collection under "emergency" conditions, thus causing the system to go under. At least this is my understanding of the process.

The Fascist TRAITOR PIG needs to thrown out of the WH and into prison. No other outcome will be good enough...

[Lonestarblue]

22. The next Congress needs to rein in the powers of the president.

Trump has shown that a lawless president can do a great deal of damage in a short time. No resident should be able to cut SS taxes as a reelection stunt. And since Congress would have to approve a permanent cut, those taxes will come due in 2021. I suspect large businesses will not go along with this, but small business owners who are struggling because of the virus may well do it and worry about next year later, even if their employees don’t want it.

[appalachiablue]

23. That's right, this action by a rogue president

is dangerous and needs to be prevented in the future.

[paleotn]

25. My company isn't doing it....

Fica and medicare withholding is coming our just as it always has. We're not falling for the bullshit and neither are most American companies.

[ProfessorGAC]

29. The Chamber Of Commerce Is...

...recommending against it.
That means this is an empty promise & political ploy and even the probusiness, low taxes C of C isn't fooled.

[appalachiablue]

33. Very glad to know that about the C of C.