How to pay deferred self-employment tax

The CARES Act allowed self-employed individuals and household employers to defer the payment of some of their Social Security taxes on their 2020 tax returns. This was a one-time deferral. Half of the deferred amount is due by 12/31/21 and the other half is due by 12/31/22.

The IRS recently announced how to pay these taxes. They say:

  • The payments for the deferred amount should be separate payments from other tax payments to ensure they are applied to the deferred tax balance on the tax year 2020 Form 1040 since the IRS systems won’t recognize the payment for deferred tax if it is comingled with other tax payments or paid with the 2021 or 2022 Form 1040.
  • Write on the memo line: “Deferred Social Security Tax 2020.”

The IRS says you can pay online but as of this writing, I do not see the ability to pay online and designate the payment as “Deferred Social Security Tax” so you can wait to see if the system will be updated or write a check and mail it using certified mail so you have proof of mailing.

 

 

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