Facebook post misleadingly says Trump payroll tax action helps only employers, not employees

President Donald Trump’s weekend order to give millions of workers a break on payroll taxes caught many people by surprise, and created a range of reactions, criticism and questions.

One Facebook post said the order doesn’t help workers, it helps employers.

"Let me splain how ‘no payroll taxes’ helps you, it doesn’t. It helps employers & defunds years of Social Security you already paid," the post said.

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It’s actually hard to see how Trump’s action helps employers, as the Facebook post claims. Many observers say it makes life harder for employers, because it’s unclear where things will stand next year after the election. Payroll taxes flow through employers. If they simply let workers keep the money, they could need to pay back the amount deferred in fairly short order, depending on the next president and Congress.

"They would be risking their decision to defer based on a very uncertain political outcome this fall and thus potentially face a significant payment to the Trust Funds early next year," said William Hoagland, senior vice president of the Bipartisan Policy Center, a Washington think tank.

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Right after Trump announced his move, the business magazine Inc. published an article that echoed Hoagland’s point, telling businesses "the prudent thing is to hold tight and not change withholdings."

Economist Eugene Steuerle at the Urban-Brookings Tax Policy Center said a future Congress would be "unlikely" to force workers to pay back the amount deferred.

"When it comes to individuals, it’s almost impossible to recoup the money," Steuerle said. "Many people have almost no savings at all."

Again, no one knows for sure what will happen in 2021.

A Facebook post claims, "Let me splain how ‘no payroll taxes’ helps you, it doesn’t. It helps employers & defunds years of Social Security you already paid."

Many observers say it makes life harder for employers, because it’s unclear where things will stand next year after the election. Payroll taxes flow through employers. If they simply let workers keep the money, employers would need to pay back the amount deferred in fairly short order, depending on the next president and Congress.

We rate this post Half True.