Deferred Payroll Taxes Due December 31, 2022

Deferred payroll tax

Businesses have until December 31, 2022, to complete payment on deferred payroll taxes from 2020.

The Coronavirus, Aid, Relief and Economic Security Act (CARES Act) allowed employers to defer the payment of the employer's share of Social Security taxes, and self-employed individuals to defer payment of certain self-employment taxes. This was done to grant a reprieve for businesses struggling during the pandemic. The period allowed for deferment was March 27, 2020, through December 31, 2020.

Half of the deferred amount was due December 31, 2021, and the other half is due December 31, 2022. Businesses have until midnight on December 31, 2022, to make their payment.

If a business doesn’t pay their deferred taxes by then, the penalty is 10% of the entire deferred amount. The penalty increases to 15% is the business still doesn’t pay within ten days of the IRS issuing a notice. For example: if a business deferred $100,000 in taxes, the penalty is $10,000. If the business fails to pay within ten days of the IRS issuing a notice, the penalty is $15,000.

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