About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

1 1 (March 20, 2020)

handle is hein.crs/govcavt0001 and id is 1 raw text is: Researh Sevice COVID-19 Economic Stimulus: Business Payroll Tax Cuts March 20, 2020 The economic fallout from coronavirus disease (COVID- 19) has accelerated rapidly. Policymakers continue to evaluate tax policy economic relief options. Payroll tax cuts for businesses are one option that would provide economic assistance to business activities. Business Payroll Taxes Payroll taxes are collected to finance certain entitlement programs, including Social Security, parts of Medicare, and Unemployment Compensation (UC). Social Security's old age, survivors, and disability insurance (OASDI) payroll tax is paid by both employers and employees, and it finances the Social Security trust funds. The tax equals 6.2% of wages on the taxable earnings base ($137,700 in 2020). This tax is paid by both employers and employees (with self-employed individuals paying both the employer and the employee share, or 12.4%). The primary source of funding for Medicare Part A is a separate payroll tax paid by employers and employees. Each pays a tax of 1.45% on the employee's earnings; the self-employed pay 2.9%. Employers typically deposit payroll taxes with the Internal Revenue Service semiweekly or monthly, and report employment taxes paid on quarterly federal tax returns filed no later than 30 days after the end of the calendar quarter. Some employers with small payrolls may file annually. Employment payroll taxes generally are paid by all types of employers: businesses, nonprofits, and government employers. Thus, tax relief that is provided through payroll tax reductions may be available to nonprofits, which generally do not benefit from income tax reductions. If maintaining Social Security or Medicare Part A trust fund balances is a policy objective, these funds can be made whole through a transfer of general revenue. In this case, the revenue loss from a payroll tax cut would add to the deficit, but not decrease amounts available for Social Security or Medicare benefits. Temporary cuts to payroll taxes enacted in past recessions have protected trust ,finds from any impact in such a manner. Congressional Research Service https://crsreports.congress.gov IN11260 CRS }NStGHT Prepaed for Membei's and Cornm ittees o4 Co q _gress ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Short-term subscription options include 24 hours, 48 hours, or 1 week to HeinOnline.

Purchase Access

Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most