Finally, the IRS issued guidance on Friday evening about payroll tax deferrals.
And, as we’ve been communicating … this may not be a very helpful program for most Cleveland taxpayers. In fact, it’s actually up to employers (not employees) whether or not to withhold Social Security payroll taxes from their employees’ paychecks from September through December. And again — this is a DEFERRAL, not forgiveness. With the elections looming, it’s unlikely to be forgiven.
Therefore, to pay back the amounts that were deferred, the Social Security withholding taxes would increase from Jan 1 through April 30.
This means (for employees) more money for a few months and then less for a few months after. For employers, it’s even thornier (what if the employee is no longer there? etc.) … so you can’t count on this for help.
But you can count on yourself, and the decisions you make NOW to help your financial situation. Even if you are locked-in to a particular rate of pay, there are always decisions you can make that will affect your bottom line.
And we’re here to help: https://hinckleytaxservice.com/%E2%80%8B/schedule-a-call/
Here’s a decision that will most assuredly affect your financial situation: riding the media-driven rollercoaster of fear, anger and chaos.
I’m not advocating that you shut your eyes to what’s happening in the world. There are some very hard things happening.
Nor am I suggesting that you shouldn’t prepare for what looks to become a very chaotic, eventful fall. Especially in the month surrounding the election.
But what I *am* suggesting, as I have previously, is that if you take too much time and emotional energy rubbernecking at the slow-motion car crash that is our current political and cultural moment, you WILL drain your energy for productive, income-producing work and decisions.
Very few of my Cuyahoga County readers are in a position or role in which it tangibly matters that they are as “informed” or plugged-in as seems to be the norm.
Instead, many people I know seem to read news and commentary with an intent to arm themselves for gladiatorial social media arguments — which very rarely produce benefits for anyone.
Do you know what WILL produce benefits?
Getting ahead of the tax planning game. ESPECIALLY in light of impending electoral chaos, it’s a good idea to get your ducks in a row so that your 2020 tax bill is as low as it can possibly be.
We’re all going to want to make sure we are keeping all that we possibly can in this season.
So use this to connect with my office: https://hinckleytaxservice.com/%E2%80%8B/schedule-a-call/ (or reply to this strategy note by sending us an email through the email us button at the top of the page) and request one of our limited Tax Planning Saver Sessions. During this session, we will analyze your current situation and identify clear action steps for the last quarter of 2020 — designed to save your bottom line hundreds (or even thousands).
*This* will be productive work that tangibly matters.
To your family’s lasting financial and emotional peace…
Let’s do something that makes a real difference — to your family’s bottom line.
“CRISIS Action Plan” for my Cleveland tax clients and friends:
1) Don’t marinate in other people’s panic. Be mindful of your social media consumption.
2) Continue to stay financially and logistically prepared for worsening situations.
3) Make sure you have some ready, liquid assets, if you are able. (I.e., cash in the bank, and in hand.)
4) Set aside plans for any big spending until the dust settles — but especially look out for your small business owner friends and vendors.