Social Security Payroll Tax Deferral
The Consolidated Appropriations Act, 2021 was passed and extended the period for collecting deferred 2020 Social Security taxes. The period for collection is now January 1, 2021 through December 31, 2021.
At the end of December, the 2020 Social Security tax deferral will end. Beginning January 2021, the normal 6.2% Social Security tax withholdings will again be deducted from pay for military members and civilians, and an additional deduction for the deferred 2020 Social Security tax collection taken from pay.
Per IRS guidance (as modified by the Consolidated Appropriations Act, 2021), the Social Security taxes deferred in 2020 will be collected from pay between January 1 and December 31, 2021.
Military Members -
For active duty military members, the 2020 deferred Social Security taxes will be collected in 24 installments, from your mid-month and end-of-month pay between January 1 and December 30, 2021.
For reservists and guardsmen performing intermittent duty in 2021, the amount collected may not be the same every pay period. DFAS will collect 2% of net available from each weekly, mid-month and end-of-month pay, and will continue until the deferred taxes have been repaid in full.
Beginning in January 2021, your myPay LES will reflect the monthly collection amount and contain a note in the remarks section that shows the remaining balance of deferred Social Security taxes.
Civilian Employees –
The amount of Social Security taxes deferred in 2020 will be collected in 24 installments between pay-periods ending January 16 and December 4, 2021. In some specific cases, Social Security taxes deferred in 2020 will be collected into pay-period December 18, 2021.
Beginning in January 2021, your myPay LES Remarks section will include the 2020 deferred OASDI collection amount in that pay period, as well as the remaining balance to be collected.
If you separate or retire prior to the deferred Social Security tax being collected in full the unpaid balance will either be collected from your final pay or you may receive a debt letter with instructions for repayment. Collection will occur through the debt management process. You will receive a debt letter via US mail which will provide instructions for repayment. Payments can be made online via Pay.gov.
Regarding 2020 Social Security Tax Deferral Form W-2Cs, please see “Instruction for Employees” section via this link.
Pursuant to IRS Notice 2020-65 and at the direction of the Office of Management and Budget and Office of Personnel Management, Social Security (Old Age, Survivors, and Disability Insurance) or “OASDI” tax withholdings were temporarily deferred from September through December 2020 and will be collected from wages paid between January 1, 2021 and December 31, 2021, for employees who had wages subject to OASDI of less than $4,000 in any given pay period. These actions were in response to the Presidential Memorandum issued on August 8, 2020.
Still have questions?
See the Military and Civilian FAQs for more information.
Payroll Collection Links
September 2020 Tax Deferral Fact Sheets
Page updated September 13, 2021