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Two-Month Payroll Tax Holiday Cannot Be Implemented Properly, Experts Say
ABC ^ | 12/19/11 | Jake Tapper

Posted on 12/19/2011 12:30:21 PM PST by freespirited

Officials from the policy-neutral National Payroll Reporting Consortium, Inc. have expressed concern to members of Congress that the two-month payroll tax holiday passed by the Senate and supported by President Obama cannot be implemented properly.

Pete Isberg, president of the NPRC today wrote to the key leaders of the relevant committees of the House and Senate, telling them that “insufficient lead time” to implement the complicated change mandated by the legislation means the two-month payroll tax holiday “could create substantial problems, confusion and costs affecting a significant percentage of U.S. employers and employees...”

The NPRC ... represents organizations that provide payroll processing and services to more than 1.5 million employers, impacting one third of the private sector....

Isberg wrote that “many payroll systems are not likely to be able to make such a substantial programming change before January or even February. The systems affected tend to be highly complex, normally requiring at least ninety days for a change of this magnitude for software testing alone; not to mention analysis, design, coding and implementation.”

Part of the issue has to deal with Congress’ desire to make sure “that highly compensated employees not enjoy the full benefit of the 2% tax break because of bonuses or other high compensation falling into the first two months of the year,” Isberg wrote, saying “there simply is insufficient time to implement this major change in withholding requirements.”

(Excerpt) Read more at abcnews.go.com ...


TOPICS: Front Page News; News/Current Events
KEYWORDS: democrats; fail; incompetence; obama; payrolltax; taxes
So Harry Reid and the WH never considered the logistics. Is anyone surprised?
1 posted on 12/19/2011 12:30:28 PM PST by freespirited
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To: freespirited

If the DIMs are so Hell bent on the “Payroll tax cut” why dont they just pass a simple 2% income tax cut rather than target SS? In the end isn’t about the same thing?


2 posted on 12/19/2011 12:37:35 PM PST by frogjerk (OBAMA NOV 2012 = HORSEMEAT)
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To: freespirited

Who understands what the Dems see as an advantage to them with the 2 month extension as opposed to 1 year? Not obvious to me.


3 posted on 12/19/2011 12:38:41 PM PST by InterceptPoint (TIN)
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To: freespirited
Well, I think they aren't being entirely genuine in their objections. I am very familiar with payroll systems, and they are absolutely correct that it is probably impossible to get systems to properly account for any nuances this late in the game.

However, every payroll pro knows a very simple (and inconvenient) truth: the exceptions can be run manually. Pain in the a**? Hell yeah.

Or, they could rebate the cut in a lump sum in two months. Another payroll and accounting nightmare, but it's not like this law is the first one to create those....

4 posted on 12/19/2011 12:38:58 PM PST by Mr. Bird
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To: freespirited

Harry and the WH don’t need no stinking logistics.
They rule, we fix later, if we can - doncha know that?!


5 posted on 12/19/2011 12:39:01 PM PST by seenenuf ( Save the Right Supremes.)
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To: freespirited

people need to pay for their own SS and medicare.....not other people. It’s stupid and not a tax cut but are trying to turn it into more welfare. Democrats are playing games to try to move around the deck chairs on the Titanic. Republicans should emphasis other people will be getting a tax hike, like people who refinance to pay for this.


6 posted on 12/19/2011 12:41:05 PM PST by snowstorm12
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To: frogjerk
“If the DIMs are so Hell bent on the “Payroll tax cut” why dont they just pass a simple 2% income tax cut rather than target SS? In the end isn’t about the same thing?”

It isn't the same to the RAT voter base, the majority of which pay no income taxes.

7 posted on 12/19/2011 12:48:21 PM PST by Beagle8U (Free Republic -- One stop shopping ....... It's the Conservative Super WalMart for news .)
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To: frogjerk
No it is entirely NOT the same thing at all. Democrats are hell bent on giving money to their lower paid constituents. Problem is, how in the hell to do it? They mostly (and I do mean mostly) do not pay ANY FEDERAL INCOME TAX to start with. In fact, most (again) get EITC which is really just tax money Uncle stole from you and me to give away to them. They have the nerve on top of it to call it "Earned" Income Tax Credit - a credit - dollar for dollar (not paid). Upshot? They get several thousand a year for nothing, they never paid in.

Now, how to give them MORE money? Well, I said Federal INCOME Tax...SS is taxed on EVERYBODY; it's called OASDI and is a straight 6.2% right of the top. They have to pay it and can't get any of it back at the end of the year. So, OBAMA decides we're gonna cut that 2% to 4.2% and it won't hurt his constituents' minimum benefits under SS. Government sponsored theft is all this house of cards is. It will fall, certain.

8 posted on 12/19/2011 12:51:26 PM PST by Gaffer
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To: InterceptPoint
“Who understands what the Dems see as an advantage to them with the 2 month extension as opposed to 1 year? Not obvious to me.”

They want another 2 months to play games and add/subtract things to the bill. Kick the can down the road and figure out a way to get rid of the pipeline mandate.

9 posted on 12/19/2011 12:55:14 PM PST by Beagle8U (Free Republic -- One stop shopping ....... It's the Conservative Super WalMart for news .)
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To: freespirited

While it has been involving other taxes, it seems the past several years, there have been these last minute games in DC, with no thought to the real world consequences.


10 posted on 12/19/2011 12:58:10 PM PST by PghBaldy (War Powers Res: http://avalon.law.yale.edu/20th_century/warpower.asp)
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To: freespirited

Payroll tax changes are a nightmare for employers. For a large employer these taxes computed in almost real time. The taxes must be deposited within one business day of payment of the wages. The change that was put in place last year was difficult to implement because payroll tax computer programs had to be redone.

Many employers had to do this by excel spreadsheets while waiting on their programmers. Mistakes were made, penalties were assessed and letter had to be written asking for those penalties to be abated.

A two month deal is truly a nightmare because payroll taxes, although paid daily, weekly or monthly are reconciled and reported on a quarterly (3 month period). The IRS would have to revise Form 941 and may not have the form ready for the 1st quarter.


11 posted on 12/19/2011 1:00:45 PM PST by Truth is a Weapon (Truth, it hurts so good.)
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To: frogjerk
If the DIMs are so Hell bent on the “Payroll tax cut” why dont they just pass a simple 2% income tax cut rather than target SS? In the end isn’t about the same thing?

No. 47% of the people that earn a paycheck, do not pay federal taxes and therefore, would receive no benefit. In addition, if there were a 2% income tax cut, it would apply to those filthy rich people on all of their income. It would be a bloody windfall for the rich (in the words of a democrat).

That said, I agree with you.

12 posted on 12/19/2011 1:08:22 PM PST by Go Gordon (President Poverty - President Downgrade - President Food Stamp - President Pantywaist - B. H. Obama)
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To: freespirited

Who cares about practical reality? We’re trying to establish a post Constitutional utopia here, so get on board or get lost!


13 posted on 12/19/2011 1:09:13 PM PST by Attention Surplus Disorder (Gun store gift certificate. An idea whose time has come.)
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To: InterceptPoint

“Who understands what the Dems see as an advantage to them with the 2 month extension as opposed to 1 year? Not obvious to me.’

Gives them 2 more months to figure out how to kill Keystone and blame it on the Republicrats.


14 posted on 12/19/2011 1:11:45 PM PST by EQAndyBuzz (To fix government, we need a rocket scientist. Oh, wait we have one!)
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To: freespirited

It is all just smoke and mirrors anyway, so why bother as to the logistics or the implementation.


15 posted on 12/19/2011 1:17:55 PM PST by OldBullrider (if yur hurt, rub some dirt on it, and get back to work)
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To: freespirited

They can sure implement things to waste trillions but they can’t do this? Obama and Reid probably knew this all along that is why they pushed it to look good politically.


16 posted on 12/19/2011 1:18:05 PM PST by Dubya-M-DeesWent2SyriaStupid!
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To: freespirited

Somebody needs to tell the Senate RINOs about this.


17 posted on 12/19/2011 1:24:55 PM PST by colorado tanker
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To: frogjerk
why dont they just pass a simple 2% income tax cut rather than target SS?

Not ever one pays income tax so it would not be a cut for them, but FICA affects everyone that works whether or not they actually pay any income tax.

18 posted on 12/19/2011 1:49:37 PM PST by itsahoot (Throw them all out! Especially the Frugal Socialists who call themselves Republicans.)
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To: InterceptPoint
Who understands what the Dems see as an advantage to them with the 2 month extension as opposed to 1 year?

No Keystone pipe line.

19 posted on 12/19/2011 1:58:43 PM PST by itsahoot (Throw them all out! Especially the Frugal Socialists who call themselves Republicans.)
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To: itsahoot

No Keystone pipe line.
++++++++++
Hmmmm. How will that work?


20 posted on 12/19/2011 2:14:37 PM PST by InterceptPoint (TIN)
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To: Mr. Bird

How is it not being entirely genuine in their objections to basically point out that this ridiculous proposed two-month extension is, as you put it a Pain in the a**? and a payroll and accounting nightmare?

What the terms “Pain in the a**?” and “payroll and accounting nightmare” mean is that the private sector businesses will have to absorb or pass on the costs associated with a payroll and accounting nightmare, so that the democrats can play their stupid political games that we all see through.


21 posted on 12/19/2011 2:24:21 PM PST by ngat
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To: AdmSmith; AnonymousConservative; Berosus; bigheadfred; Bockscar; ColdOne; Convert from ECUSA; ...

Thanks freespirited.

Not voting in favor of the extension is the same thing as voting for a tax increase.

Boehner’s screwing the pooch on this one.


22 posted on 12/19/2011 2:53:22 PM PST by SunkenCiv (Merry Christmas, Happy New Year! May 2013 be even Happier!)
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To: freespirited

Let’s look at this for a minute:

If the extension hadn’t been passed, they’d have had to change the rates January 1. If the full year extension had been passed, they’d have had to drop their plans to revert back on Jan 1, and continue the current rate. With the partial term, the rate change comes in March. So, why is it possible for them to change rates in January, but impossible to do it in March? This just sounds like a manufactured excuse to get the full year extension.


23 posted on 12/19/2011 3:02:38 PM PST by ArmstedFragg (hoaxy dopey changey)
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To: InterceptPoint
Hmmmm. How will that work?

You really don't know?

24 posted on 12/19/2011 3:34:37 PM PST by itsahoot (Throw them all out! Especially the Frugal Socialists who call themselves Republicans.)
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To: itsahoot

I really don’t know. How does a 2 month extension kill the pipeline? Oboma can kill it any time he wants. He has the option to do so.


25 posted on 12/19/2011 4:27:00 PM PST by InterceptPoint (TIN)
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To: InterceptPoint
I really don’t know.

It doesn’t force him to make a decision, yea or neigh, so it effectively lets him kill the project through endless delays, as is the current policy. If during all the delays, Canada decides to sell to China then we lose the oil and the jobs.

26 posted on 12/20/2011 12:20:04 PM PST by itsahoot (Throw them all out! Especially the Frugal Socialists who call themselves Republicans.)
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To: itsahoot
It doesn’t force him to make a decision, yea or neigh, ...

Maybe so but that's not obviously true. Doesn't either of the current bills give him 60 days to make a decision up or down? When the 60 days is up we want a decision. If he signs the bill he commits to that schedule.

What am I missing?

27 posted on 12/20/2011 1:31:12 PM PST by InterceptPoint (TIN)
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