House Ways and Means ranking member Kevin Brady. (Photo: AP)
House Ways and Means Committee ranking member Kevin Brady, R-Texas, introduced legislation late Friday that would "forgive" Social Security taxes deferred under President Donald Trump's executive order.
Brady's bill, the Support for Workers, Families and Social Security Act, would create a temporary payroll tax holiday from Sept. 1 through Dec. 31, 2020, for all workers, Brady said in a statement.
The bill decreases for four months the Old Age, Survivors, and Disability Insurance tax rate by 6.2% — the full amount that workers pay — and decreases the annual Self-Employment Contributions Act tax rate by approximately 2.07%.
The Social Security trust fund "would be held harmless through transfers from the general fund equal to the reductions in revenues," according to the Joint Committee on Taxation's analysis of Brady's bill.
"I call on Congress, including Democrats who forgave these payroll taxes twice for President Obama, to act now to help our essential workers keep more of what they work so hard to earn," Brady said. "We're not through this pandemic yet, and this will help local economies, create certainty for businesses, and safeguard Social Security."
President Barack Obama signed two separate bills that cut payroll taxes by 2% — the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 and the Middle Class Tax Relief and Job Creation Act of 2012.
The IRS issued guidance on Aug. 31 for employers that choose to give their employees a temporary break from the Social Security payroll tax.
