The President announced that he would defer collection of the F.I.C.A. tax that supports Social Security between September and December of this year. Note that the President only announced that the tax would be deferred. It would all still be due in January. It is not within a President’s power to cancel it. In fact, it’s not really within his power to defer it.
The employee’s part of that tax is 7.65% of gross payroll. If the President’s plan goes forward, employees will find themselves owing 30.6% of their gross paycheck in payroll taxes in January in addition to income tax withholding.
So, let me ask you. Would you rather pay your F.I.C.A. month by month or would you rather have no F.I.C.A. tax for three months followed by a large balloon payment that eats up a huge portion of your salary, after the election, in January?
And it's not just employees who may find this tax deferral of questionable utility. The vice president for government affairs of ADP says that deferring the F.I.C.A. tax requires "a little bit of a leap of faith on an employer’s part." You may well ask who is ADP? It's a corporation. They process payroll for 40 million workers and 800,000 businesses. If ADP doesn't defer F.I.C.A., there probably will be little deferring of F.I.C.A.