One of the most recent executive orders issued by President Donald Trump will defer payroll tax obligations, but how will that impact you?
President Trump issued an executive order deferring payroll tax obligations starting Sept. 1 and running through the end of the year, which could allow Americans to retain thousands of dollars that would previously been taken from them by the government.
Payroll taxes are 6.2% of your salary, but depending on your pre-tax deductions, your take-home pay could go up by 8% or more starting in September.
Without additional deductions, an American making the median income of $64,000 a year could expect to retain $152 per bi-weekly paycheck, amounting to $1,216 by the end of the 2020.
But will they be able to keep it? Trump wants Americans to use that money how they wish.
Trump's executive order says, “The Secretary of the Treasury shall explore avenues, including legislation, to eliminate the obligation to pay the taxes deferred pursuant to the implementation of this memorandum.”
The statement is necessary because Trump’s order is only a tax deferment, the ability to eliminate the obligation does not rest in the power of the Executive Branch. From statements seen in the video above, it would seem Democrats are expecting to get all that money back in 2021.
If legislation is required, will Congress allow Americans to retain the money? Or will they demand that the taxman take it all back?