An employer defers the employer's share of Social Security tax by reducing required deposits or payments for a calendar quarter (or other employment tax return period) by an amount up to the maximum amount of the employer's share of Social Security tax for the return period to the extent the return period falls within ...

How does the payroll tax deferment work?

Payroll tax deferral

Due to the CARES Act, all employers can defer for up to two years the deposit and payment of their share of the social security tax on employee wages. Amounts normally due between March 27, 2020 and Dec. 31, 2020, can be deferred with 50 percent required to be paid by Dec.

What does the payroll tax deferment mean for employees?

What Does the Payroll Tax Deferral Mean for Employees' Taxes? Employees pay half of a 12.4% tax on their wages which covers Social Security, plus 2.9% to pay for Medicare. The payroll tax deferral means that the employee's share of this tax withholding is deferred (not canceled or forgiven, just deferred) into 2021.