What to Do if You Can’t Opt Out of This Year’s Payroll Tax Deferral

This payroll tax deferral is pretty much bullshit. It doesn’t help employees and causes extra work for employers. Employers who understand it opted out. You should ask your employer if they are doing the payroll tax deferral, because it affects your paycheck. However federal employees cannot opt-out. So what do you do? On the podcast, Make Me Smart, Kai Ryssdal said that starting January 1st, the payroll tax deduction will cease and actually your paycheck will go back to the original deduction.

In the meantime, employees should find out the exact amount of the payroll tax by looking at the line item in old paycheck stub (pre-deferral) and automatically put that amount in a separate bank account. It could be a checking account, savings account or any FREE online account that you can schedule an automatic withdrawal.

Paychex, a company that handles payroll for small businesses, offers some guidance on their homepage. My guidance for employers is to opt out.