COVID-19 | Jan. 13, 2021

ALCOAST 013/21 - COVID-19: PAYROLL TAX DEFERRAL – UPDATE: COLLECTIONS

R 121634Z JAN 21
FM COMDT COGARD WASHINGTON DC
TO ALCOAST

UNCLAS
ALCOAST 013/21
SSIC 7401
SUBJ:  COVID-19: PAYROLL TAX DEFERRAL – UPDATE: COLLECTIONS
A. Presidential Memorandum on Deferring Payroll Tax Obligations 
in Light of the Ongoing COVID-19 Disaster
B. Internal Revenue Service Notice 2020-65 - Relief with 
Respect to Employment Tax Deadlines
C. COMDT COGARD WASHINGTON DC 041244 SEP 20/ALCOAST 329/20
1. This ALCOAST announces impending modifications to take-home 
pay, for both civilian employees and military members of the 
Coast Guard, who had their payroll tax deferred in Sep, Oct, 
Nov, and Dec 2020. The employee portion of the Old Age, Survivors, 
and Disability Insurance (OASDI) segment of the Federal Insurance 
Contribution Act (FICA) tax, i.e., the 6.2% tax on employee wages 
(basic pay only for military) that was not collected, will be 
deducted from pay beginning in Jan 2021.
2. REF (A) was the Presidential Memorandum authorizing the
deferral, REF (B) provided additional information, and REF (C)
outlined those affected by the deferral.
3. Those military members that had taxes deferred will see 
a decrease in take-home pay beginning mid-month Jan.  
   a. For active duty military members, the 2020 deferred 
OASDI taxes will be collected in 24 installments from your 
mid-month and end-of-month pay between 01 Jan and 31 Dec 2021.
   b. For reservists and those performing intermittent duty 
in 2021, the amount collected may not be the same every pay 
period. The Coast Guard will collect from each weekly, mid-
month and end-of-month pay, and will continue until the 
deferred taxes have been repaid in full.
4. For civilians who had their taxes deferred collection of 
the deferred taxes will be taken from wages paid between 01 
Jan through 19 Dec 2021 (PP 26, 2020, through PP 25, 2021), 
known as the repayment period. The total amount of the 2020 
deferred OASDI withholding will be collected on a prorated 
basis from pay, divided evenly among these pay periods. The 
National Finance Center has computed the total deferred amount 
by employee, which constitutes 26 pay periods to compute a per-
pay-period repayment amount. During the repayment period, the 
payroll system will calculate the normal pay period OASDI taxes 
based upon the OASDI wages earned in that pay period, and then 
add the prorated repayment amount calculated as defined above. 
This will be reflected on the Statement of Earnings and Leave 
(E&L), starting in PP 26, 2020, which will be paid out on 
January 11, 2021.
5. This message will be cancelled on 31 DEC 21.
6. Questions for military members regarding this collection 
should be addressed to: Compensation@uscg.mil. 
7. Questions for civilian employees should be addressed to the 
employee’s servicing Human Resources Specialist:
https://www.dcms.uscg.mil/Portals/10/CG-1/cg121/docs/Servicing%20
Assignment%20Update%20(M1).docx?ver=2018-10-23-080638-263.
8. RADM J. M. Nunan, Assistant Commandant for Human Resources 
(CG-1), sends.
9. Internet release is authorized.