CARES Act allows for payroll tax deferral
Credit unions are eligible under a provision in the CARES Act to defer paying their payroll taxes. Under the provision, half of the taxes would be due at the end of 2021 and the other half at the end 2022.
Specifically, the provision allows employers and self-employed individuals to defer payment of the employer share of the Social Security tax they otherwise are responsible for paying to the federal government with respect to their employees. Employers generally are responsible for paying a 6.2% Social Security tax on employee wages.
The CARES Act provision requires that the deferred employment tax be paid over the following two years, with half of the amount required to be paid by Dec. 31, 2021 and the other half by Dec. 31, 2022.