Late on Friday, August 28th the Internal Revenue Service (IRS) issued guidance on the payroll tax deferral that was ordered by President Trump in a presidential memorandum on August 8th. Companies are left with little time to decide whether they are going to opt in and allow eligible workers to defer payroll taxes on wages paid from September 1st through December 31, 2020. Workers are eligible if they earn less than $4,000 every two weeks, which amounts to about $104,000 per year. Eligibility is determined on a pay-period-by-pay-period basis. The notice requires affected employers to then withhold and pay the deferred taxes from wages and compensation paid during the period between January 1st and April 30th, 2021, meaning a double deduction for employees in those months. Interest, penalties, and additions to tax will begin to accrue on unpaid taxes starting May 1, 2021. The notice says, that if necessary, employers can “make arrangements to otherwise collect the total applicable taxes from the employee” but does not provide details on that requirement. The guidance also does not cover if an employee quits before the end of the year or if post-deferral earnings are not enough to cover the taxes. Treasury Secretary Steven Mnuchin has said he “can’t force” companies to stop withholding the payroll levies and the U.S. Chamber of Commerce has acknowledged many will not implement the deferral. The guidance can be found in IRS Notice 2020-65. Visit the AICPA (American Institute of Certified Public Accountants) website, for more resources.