I hope your 2022 welcoming plans are on track this New Year’s Eve eve. But as the time tick tocks away, some folks need to think a few days further into the fast-approaching New Year.
Specifically, their focus should be on Monday, Jan. 3, 2022.
That’s the day that some California residents whose lives and/or businesses were impacted by wildfires need to file certain 2020 returns.
The first workday of the New Year also is the deadline for employers and self-employed individuals who deferred paying part of their 2020 Social Security taxes.
California disaster delay: Mother Nature was not kind to millions this year. There was Hurricane Ida’s widespread damage and the unusual early-December deadly tornado outbreak.
But before those catastrophes struck, California was again dealing with wildfires.
And in mid-November, the Internal Revenue Service announced that some wildfire victims in parts of the Golden State wildfire have until Jan. 3, 2022, to file various individual and business tax returns and make tax payments. The extension applies to wildfire-affected individual and business taxpayers in Lassen, Nevada, Placer, Plumas, Tehama, and Trinity counties.
If you’re one of those individuals or business owners, check out the IRS specifics on which deadlines and payments are affected by the fast-approaching Jan. 3, 2022, deadline.
Social Security payments due, too: Then there are the businesses, including the single person entities, across the whole United States that opted to delay making payroll tax payments.
This business tax deferral option was part of COVID relief measures enacted in 2020. At that time, in order to provide struggling businesses a bit of cash-flow relief, traditional employers and the self-employed were allowed to put off paying the employer’s share of their eligible Social Security tax liability, which normally is 6.2 percent of workers’ wages.
Half of that deferred amount is due on Jan. 3, 2022. The other half is due on Jan. 3, 2023.
How to pay the deferred taxes: Employers and self-employed individuals have a variety of options in making the deferred payroll tax payments due 1/3/22.
They can pay via the Electronic Federal Tax Payment System (EFTPS), use IRS Direct Pay, or pay by credit or debit card, money order, or check.
To be sure these payroll tax amounts are credited properly, the IRS emphasizes that they must be made separately from other business tax payments.
EFTPS has an option to make a deferral payment. On the Tax Type Selection screen, choose Deferred Social Security Tax and then change the date to the applicable tax period (typically, the calendar quarter in 2020 for which tax was deferred).
If you have EFTPS questions, visit that website (EFTPS.gov), call toll-free 1-800-555-4477 or 1-800-733-4829.
Those who choose to use Direct Pay should select the “balance due” reason for payment. If paying with a debit or credit card, select “installment agreement.” Apply the payment to the 2020 tax year where the payment was deferred.
You also can find more on payment options at the IRS Paying Your Taxes web page.
Whichever filings and payments you’re making on Jan. 3, 2022, be sure not to miss the delayed deadlines. You definitely do not want to get the new tax year off to a bad start.
You also might find these items of interest:
- It’s time to file your taxes & pay what you can
- AMT, payroll, and nanny tax inflation changes for 2022
- Paying self-employment taxes on the revised Schedule SE
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