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House Democrat offers measures to block Trump's payroll tax deferral

House Democrat offers measures to block Trump's payroll tax deferral
© Greg Nash

A House Democrat on Friday introduced two measures in an effort to block President TrumpDonald TrumpBlinken holds first calls as Biden's secretary of State Senators discussing Trump censure resolution Dobbs: Republicans lost in 2020 because they 'forgot who was the true leader' MORE's initiative to defer payroll taxes.

Rep. John Larson John Barry LarsonCOVID-19 damage to Social Security to extend beyond pandemic It's time for a grand agreement on Social Security What we need to do next to defeat COVID and unify the country MORE (D-Conn.), the chairman of the House Ways and Means Committee's Social Security subpanel, introduced a bill to nullify IRS guidance implementing the Social Security payroll tax deferral. He also introduced a Congressional Review Act (CRA) resolution to overturn the IRS guidance.

Larson introduced the measures along with several other lawmakers, including Ways and Means Committee Chairman Richard NealRichard Edmund NealJudge says Treasury must give Trump 72 hours before releasing tax info to Democrats Trump's lawyers seek clarity about how tax-return case will proceed following Biden inauguration IRS says start of tax filing season delayed until Feb. 12 MORE (D-Mass.). The House members introduced the measures after Senate Democrats also launched an effort to overturn the guidance, which implements a memo Trump signed last month.

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Senate Minority Leader Charles SchumerChuck SchumerHumanist Report host criticizes 'conservative Democrats:' They 'hold more power' than progressives Bush-, Obama-era officials urge Senate to swiftly confirm Biden's DHS pick OVERNIGHT ENERGY: Court upholds ruling invalidating Dakota Access, but doesn't shut down pipeline | Schumer calls for Biden to declare climate emergency | Biden seeks to bolster consultation with Indian Country MORE (D-N.Y.) and Senate Finance Committee ranking member Ron WydenRonald (Ron) Lee WydenWhat the shift in Senate control means for marijuana policy reform Hawley files ethics counter-complaint against seven Democratic senators Hillicon Valley: Intelligence agency gathers US smartphone location data without warrants, memo says | Democrats seek answers on impact of Russian hack on DOJ, courts | Airbnb offers Biden administration help with vaccine distribution MORE (D-Ore.) on Wednesday sent a letter to the Government Accountability Office (GAO) asking for a determination about whether the IRS guidance is a rule for purposes of the CRA.

If the government watchdog determines that the guidance is a rule for CRA purposes, Senate Democrats would be able to force a vote on the Senate floor on a resolution to overturn the guidance. But the measure would face an uphill battle given the Republican majority in the chamber.

A spokesperson for Larson said there hasn't been a response yet from GAO.

Under the IRS guidance, employers can stop withholding employee-side Social Security taxes through the end of the year for workers making under $4,000 biweekly. The money would then be collected by increasing the amount of taxes withheld from workers' paychecks in the first few months of 2021.

The federal government is set to defer payroll taxes for its employees. However, many private-sector businesses are expected to not participate because they don't want to put their workers in a situation where they could receive less in take-home pay next year.

Democrats have expressed concerns about the impact of Trump's payroll tax deferral on Social Security. In a statement on Friday, Larson called the deferral Trump's "first step in defunding Social Security."

Treasury Secretary Steven MnuchinSteven MnuchinThe Hill's Morning Report - Biden argues for legislative patience, urgent action amid crisis On The Money: Senate confirms Yellen as first female Treasury secretary | Biden says he's open to tighter income limits for stimulus checks | Administration will look to expedite getting Tubman on bill Senate confirms Yellen as first female Treasury secretary MORE said at a hearing earlier this week that as it currently stands, the deferred taxes would be paid. He added that if Congress passes legislation that forgives the deferred taxes, the legislation would also transfer money from the general fund to the Social Security trust fund.