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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWhat Trump's executive order on payroll taxes reall means
(Sorry if this is a dupe - I did a quick search and didn't find it).
This is the first explanation I've seen that actually captures what Trump did with his executive order - and the consequences for ordinary people and businesses.
There are three possibilities.
Scenario #1: Congress opts for a tax jubilee, forgiving these delayed payroll taxes altogether and converting Trumps tax deferral into an outright tax cut. Trump is clearly hoping for this.
. . .
Scenario #2: Congress does nothing, and employees still have to pay all these deferred taxes when filing their income tax returns next year. That is, a huge, unexpected bill will come due around April 15.
. . .
This brings us to Scenario #3: Employers including cash-strapped small businesses are left holding the bag. And at this point, the tax bill could actually get bigger. Heres why: Come 2021, if and when employers pay the IRS for the payroll tax debts their employees never paid, under U.S. tax law such payments would be treated as income to each affected employee.
https://www.washingtonpost.com/opinions/trumps-inadvertent-tax-hike/2020/08/10/12457502-db00-11ea-809e-b8be57ba616e_story.html?fbclid=IwAR2xP-Js00IMtVgL_HMoeCDiVprBSD96TMFuanSrfoT8hkauvWgLvdf6z9A
Thomas Hurt
(13,903 posts)He doesn't know what our corp office is going to do yet, but he acknowledged that what Trump is doing might not be constitutional but seemed to think Trump did it to force the recalcitrant Dems back to the table...seeing as they were demanding more liberal things which offend him.
So no problem with Trump abusing his office as long as he is owning the libs.
Ms. Toad
(34,087 posts)Whether it is legal or not, is another (valid) question on which I don't have clear answers. Taxes, I can still do in my sleep, even though it was years since I was an enrolled agent.
From a tax perspective, what he did was pure evil.