FORT HOOD, Texas — Military service members at Fort Hood and across our country could soon face some financial hardships. In a new executive order, President Donald Trump will allow employers the choice to opt-out of payroll taxes through the end of this year. Federal employees and members of the military won't have that choice.
This is part of an effort to boost the economy during the coronavirus pandemic.
Active duty service members and Department of Defense civilian employees will see the first signs of the payroll tax deferral next week. According to a press release the DOD will begin to temporarily defer 6.2 percent social security tax withholding for all DOD service members who make less than $8,666.66 per month in basic pay, and all DOD civilians who make less than $4,000 per pay period.
While their paychecks will be larger, for now, they will have to pay it all back in 2021 when the government will begin to collect the tax again. On social media, 6 News reached out to military families and federal employees who have mixed emotions about the payroll tax obligations.
"It is annoying that we can't opt out of it,” Kristi Urban said. “I understand some people may need the money but there should be a choice. My husband and I are both federal employees because my husband works overtime some of the time taxes won't be taken out so it will be a pain in the butt to keep up with an amount we need to save."
"We will be putting the deferred payment aside and saving it until January to offset the repayment," Tracy Michelle said.
On Tuesday, 20 senators sent a letter to the U.S. Treasury Secretary and Office of Management and Budget Director Russell Vought urging him to make the tax deferral optional. Military Personnel and DoD employees will have to repay the IRS from January 1 to April 30, 2021.
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