USPS opts out of tax deferral program
- By Sherkiya Wedgeworth
- Sep 24, 2020
The U.S. Postal Service announced this week that it would not be implementing President Trump's controversial payroll tax deferral plan for its employees.
The program, which went into effect this month, allows employees with less than a $104,000 annual salary to keep their Social Security taxes in their paycheck for the rest of 2020; however, that money must be repaid between Jan. 1 and April 30, 2021.
“USPS has reviewed guidance issued by the Internal Revenue Service and the Office of Management and Budget…After thoroughly considering the impact on both employees and the organization, the Postal Service has elected not to implement the optional deferral,” USPS said in an announcement to its employees.
Roughly 60 percent of the more than 2 million federal employees will be impacted by the tax deferral plan that would result in reduced paychecks at the beginning of the year.
USPS handles payroll for its own employees and receives no direct taxpayer funds. It relies on revenues from stamps and other services.
The Postal Service is notifying its employees through Link— a daily news site for Postal Service employees— newsletter articles, video messages insides postal facilities and other internal communication channels.