Details of Public Law 116-260, section 274 , Extension of Certain Deferred Payroll Taxes

Internal Revenue Service Notice 2020-65 allows employers to defer the withholding and payment of the employee share of social security tax ordinarily due during the period beginning on 9/1/2020 and ending on 12/31/2020, for employees with earnings below a threshold amount. The IRS notice indicates employers that defer the withholding and payment of taxes in 2020 must withhold and pay the deferred taxes ratably over the period beginning on 1/1/2021 and ending on 4/30/2021. Interest, penalties, and additions to tax on the deferred taxes will begin to accrue on 5/1/2021.

The provision changes the deferred withholding and payment of taxes ending date from 4/30/2021 to 12/31/2021, and changes the interest, penalties, and additions to tax begin date from 5/1/2021 to 1/1/2022.