Payroll tax suspension starting today aimed at increasing take-home pay
Today marks the beginning of a payroll tax relief program that would effectively see a little bit more money in take-home pay for many working Americans.
Under the program ordered by Pres. Trump in the midst of the COVID-19 pandemic, a portion of income tax from an employee's paycheck that is usually withheld by their employer would be on hold.
The program could help add about $100 back to an employee's monthly income, providing some relief to people who are struggling financially during the pandemic.
There has been some debate among policymakers about the legality of this program.
Since employers are responsible for withholding that money from employee paychecks, they'll also be responsible for adding the money back. This has many worried about who will be held responsible if the withheld tax has to be paid back.
The administration, however, is still trying to figure it out.
"Under (Pres. Trump's) executive order, (employers) 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," said Certified Public Accountant Ed Gardner.
Also, suspension of payroll taxes would see about $139 billion less that would go to Social Security.
