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1o40 ez form Publication 80 - Main Content Table of Contents Introduction 1. 1o40 ez form Employer Identification Number (EIN) 2. 1o40 ez form Who Are Employees?Tests. 1o40 ez form Business Owned and Operated by Spouses Farm Crew Leaders 3. 1o40 ez form Employee's Social Security Number (SSN)Registering for SSNVS. 1o40 ez form 4. 1o40 ez form Wages and Other CompensationFringe Benefits 5. 1o40 ez form TipsOrdering rule. 1o40 ez form 6. 1o40 ez form Social Security and Medicare Taxes for FarmworkersThe $150 Test or the $2,500 Test 7. 1o40 ez form How To Figure Social Security and Medicare TaxesHousehold and agricultural employers. 1o40 ez form 8. 1o40 ez form Depositing TaxesPayment with Return When To Deposit How To Deposit Deposit Penalties 9. 1o40 ez form Employer's ReturnsReporting Adjustments to Form 941-SS, 944-SS, 944, or 943 Current Period Adjustments Prior Period Adjustments 10. 1o40 ez form Wage and Tax StatementsWaiver. 1o40 ez form 11. 1o40 ez form Federal Unemployment (FUTA) Tax—U. 1o40 ez form S. 1o40 ez form Virgin Islands Employers Only How To Get Tax Help Introduction This publication is for employers whose principal place of business is in the U. 1o40 ez form S. 1o40 ez form Virgin Islands, Guam, American Samoa, or the Commonwealth of the Northern Mariana Islands, or who have employees who are subject to income tax withholding for any of these jurisdictions. 1o40 ez form Employers and employees in these areas are generally subject to social security and Medicare taxes under the Federal Insurance Contributions Act (FICA). 1o40 ez form See section 6 and section 7 for more information. 1o40 ez form This publication summarizes employer responsibilities to collect, pay, and report these taxes. 1o40 ez form Whenever the term “United States” is used in this publication, it includes U. 1o40 ez form S. 1o40 ez form Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands. 1o40 ez form This publication also provides employers in the U. 1o40 ez form S. 1o40 ez form Virgin Islands with a summary of their responsibilities in connection with the tax under the Federal Unemployment Tax Act, known as FUTA tax. 1o40 ez form See section 11 for more information. 1o40 ez form Except as shown in the table in section 12, social security, Medicare, and FUTA taxes apply to every employer who pays taxable wages to employees or who has employees who report tips. 1o40 ez form This publication does not include information relating to the self-employment tax (for social security and Medicare of self-employed persons). 1o40 ez form See Publication 570, Tax Guide for Individuals With Income From U. 1o40 ez form S. 1o40 ez form Possessions, if you need this information. 1o40 ez form This publication also does not include information relating to income tax withholding. 1o40 ez form In U. 1o40 ez form S. 1o40 ez form Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands, contact your local tax department for information about income tax withholding. 1o40 ez form See Publication 15 (Circular E), for information on U. 1o40 ez form S. 1o40 ez form federal income tax withholding. 1o40 ez form Comments and suggestions. 1o40 ez form   We welcome your comments about this publication and your suggestions for future editions. 1o40 ez form   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. 1o40 ez form NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. 1o40 ez form Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. 1o40 ez form    You can also send us comments from www. 1o40 ez form irs. 1o40 ez form gov/formspubs. 1o40 ez form Click on More Information and then click on Comment on Tax Forms and Publications. 1o40 ez form   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax forms, instructions, and publications. 1o40 ez form 1. 1o40 ez form Employer Identification Number (EIN) An employer identification number (EIN) is a nine-digit number that the IRS issues. 1o40 ez form Its format is 00-0000000. 1o40 ez form It is used to identify the tax accounts of employers and certain other organizations and entities that have no employees. 1o40 ez form Use your EIN on all of the items that you send to the IRS and SSA for your business. 1o40 ez form If you do not have an EIN, you may apply for one online. 1o40 ez form Go to IRS. 1o40 ez form gov and click on the Apply for an EIN Online link under Tools. 1o40 ez form You may also apply for an EIN by calling 1-800-829-4933, (U. 1o40 ez form S. 1o40 ez form Virgin Islands only) or 267-941-1099 (toll call), or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. 1o40 ez form Do not use a social security number (SSN) in place of an EIN. 1o40 ez form If you do not have an EIN by the time a return is due, file a paper return and enter “Applied For” and the date that you applied for it in the space shown for the number. 1o40 ez form If you took over another employer's business, do not use that employer's EIN. 1o40 ez form You should have only one EIN. 1o40 ez form If you have more than one, write to the IRS office where you file your returns using the “without a payment” address in the Instructions for Form 941-SS, Instructions for Form 944, or Instructions for Form 943. 1o40 ez form Or call the IRS Business & Specialty Tax Line at 1-800-829-4933 (U. 1o40 ez form S. 1o40 ez form Virgin Islands only) or 267-941-1000 (toll call). 1o40 ez form Persons who are deaf, hard of hearing, or have a speech disability (TDD/TTY users) in the U. 1o40 ez form S. 1o40 ez form Virgin Islands may call 1-800-829-4059. 1o40 ez form The IRS will tell you which EIN to use. 1o40 ez form For more information, see Publication 1635, Employer Identification Number: Understanding Your EIN, or Publication 583, Starting a Business and Keeping Records. 1o40 ez form 2. 1o40 ez form Who Are Employees? Generally, employees are defined either under common law or under special statutes for certain situations. 1o40 ez form See Publication 15-A, Employer's Supplemental Tax Guide, for details on statutory employees and nonemployees. 1o40 ez form Employee status under common law. 1o40 ez form   Generally, a worker who performs services for you is your employee if you can control what will be done and how it will be done. 1o40 ez form This is so even when you give the employee freedom of action. 1o40 ez form What matters is that you have the right to control the details of how the services are performed. 1o40 ez form See Publication 15-A for more information on how to determine whether an individual providing services is an independent contractor or an employee. 1o40 ez form    Generally, people in business for themselves are not employees. 1o40 ez form For example, doctors, lawyers, veterinarians, and others in an independent trade in which they offer their services to the public are usually not employees. 1o40 ez form However, if the business is incorporated, corporate officers who work in the business are employees of the corporation. 1o40 ez form   If an employer-employee relationship exists, it does not matter what it is called. 1o40 ez form The employee may be called an agent or independent contractor. 1o40 ez form It also does not matter how payments are measured or paid, what they are called, or if the employee works full or part time. 1o40 ez form Statutory employees. 1o40 ez form   There are also some special definitions of employees for social security, Medicare, and FUTA taxes. 1o40 ez form   While the following persons may not be common law employees, they are considered employees for social security and Medicare purposes if the conditions under Tests , discussed later, are met. 1o40 ez form a. 1o40 ez form   An agent (or commission) driver who delivers food or beverages (other than milk) or picks up and delivers laundry or dry cleaning for someone else. 1o40 ez form b. 1o40 ez form   A full-time life insurance salesperson who sells primarily for one company. 1o40 ez form c. 1o40 ez form   A homeworker who works by the guidelines of the person for whom the work is done, with materials furnished by and returned to that person or to someone that person designates. 1o40 ez form d. 1o40 ez form   A traveling or city salesperson (other than an agent-driver or commission-driver) who works full time (except for sideline sales activities) for one firm or person getting orders from customers. 1o40 ez form The orders must be for merchandise for resale or supplies for use in the customer's business. 1o40 ez form The customers must be retailers, wholesalers, contractors, or operators of hotels, restaurants, or other businesses dealing with food or lodging. 1o40 ez form Tests. 1o40 ez form   Withhold social security and Medicare taxes from statutory employees' wages if all three of the following tests apply. 1o40 ez form The service contract states or implies that almost all of the services are to be performed personally by them. 1o40 ez form They have little or no investment in the equipment and property used to perform the services (other than an investment in transportation facilities). 1o40 ez form The services are performed on a continuing basis for the same payer. 1o40 ez form Persons in a or d, earlier, are also employees for FUTA tax purposes if tests 1 through 3 are met (U. 1o40 ez form S. 1o40 ez form Virgin Islands only). 1o40 ez form   Publication 15-A gives examples of the employer-employee relationship. 1o40 ez form Statutory nonemployees. 1o40 ez form   Certain direct sellers, qualified real estate agents, and certain companion sitters are, by law, considered nonemployees. 1o40 ez form They are generally treated as self-employed for employment tax purposes. 1o40 ez form See Publication 15-A for details. 1o40 ez form H-2A agricultural workers. 1o40 ez form   On Form W-2, do not check box 13 (Statutory employee) as H-2A workers are not statutory employees. 1o40 ez form Treating employees as nonemployees. 1o40 ez form   If you incorrectly treated an employee as a nonemployee and did not withhold social security and Medicare taxes, you will be liable for the taxes. 1o40 ez form See Treating employees as nonemployees in section 2 of Publication 15 (Circular E), for details on Internal Revenue Code section 3509, which may apply. 1o40 ez form IRS help. 1o40 ez form   If you want the IRS to determine if a worker is an employee, file Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. 1o40 ez form Voluntary Classification Settlement Program (VCSP). 1o40 ez form   Employers who are currently treating their workers (or a class or group of workers) as independent contractors or other nonemployees and want to voluntarily reclassify their workers as employees for future tax periods may be eligible to participate in the VCSP if certain requirements are met. 1o40 ez form To apply, use Form 8952, Application for Voluntary Classification Settlement Program (VCSP). 1o40 ez form For more information, visit IRS. 1o40 ez form gov and enter “VCSP” in the search box. 1o40 ez form Business Owned and Operated by Spouses If you and your spouse jointly own and operate a business and share in the profits and losses, you are partners in a partnership, whether or not you have a formal partnership agreement. 1o40 ez form See Publication 541, Partnerships, for more details. 1o40 ez form The partnership is considered the employer of any employees, and is liable for any employment taxes due on wages paid to its employees. 1o40 ez form Exception—Qualified Joint Venture. 1o40 ez form   If you and your spouse materially participate as the only members of a jointly owned and operated business, and you file a joint Form 1040, U. 1o40 ez form S. 1o40 ez form Individual Income Tax Return, or joint Form 1040-SS, U. 1o40 ez form S. 1o40 ez form Self-Employment Tax Return—U. 1o40 ez form S. 1o40 ez form Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, or Puerto Rico, you can make a joint election to be taxed as a qualified joint venture instead of a partnership. 1o40 ez form See the Instructions for Schedule C (Form 1040) or the Instructions for Form 1040-SS. 1o40 ez form Spouses electing qualified joint venture status are treated as sole proprietors for federal tax purposes. 1o40 ez form Either of the sole proprietor spouses may report and pay the employment taxes due on wages paid to the employees, using the EIN of that spouse’s sole proprietorship. 1o40 ez form For more information on qualified joint ventures, visit IRS. 1o40 ez form gov and enter “qualified joint venture” in the search box. 1o40 ez form Farm Crew Leaders You are an employer of farmworkers if you are a crew leader. 1o40 ez form A crew leader is a person who furnishes and pays (either on his or her own behalf or on behalf of the farm operator) workers to do farmwork for the farm operator. 1o40 ez form If there is no written agreement between you and the farm operator stating that you are his or her employee, and if you pay the workers (either for yourself or for the farm operator), then you are a crew leader. 1o40 ez form 3. 1o40 ez form Employee's Social Security Number (SSN) An employee's social security number (SSN) consists of nine digits separated as follows: 000-00-0000. 1o40 ez form You must get each employee's name and SSN and enter them on Form W-2AS, W-2CM, W-2GU, or W-2VI. 1o40 ez form If you do not report the employee's correct name and SSN, you may owe a penalty unless you have reasonable cause. 1o40 ez form See Publication 1586, Reasonable Cause Regulations and Requirements for Missing and Incorrect Name/TINs, for information on the requirement to solicit the employee's SSN. 1o40 ez form Employee's social security card. 1o40 ez form   You should ask the employee to show you his or her social security card. 1o40 ez form The employee may show the card if it is available. 1o40 ez form Do not accept a social security card that says “Not valid for employment. 1o40 ez form ” A social security number issued with this legend does not permit employment. 1o40 ez form You may, but you are not required to, photocopy the social security card if the employee provides it. 1o40 ez form If an employee does not have a social security card or needs a new one, the employee should apply for one on Form SS-5 and submit the necessary documentation. 1o40 ez form The employee must complete and sign Form SS-5; it cannot be filed by the employer. 1o40 ez form You may be asked to supply a letter to accompany Form SS-5 if the employee has exceeded his or her yearly or lifetime limit for the number of replacement cards allowed. 1o40 ez form If your employee has applied for an SSN but has not received the card before you must file your Form W-2 reports, and you are filing your reports on paper, enter “Applied For” in box d. 1o40 ez form Enter all zeroes in the SSN field if filing electronically. 1o40 ez form When the employee receives the SSN, file Copy A of Form W-2c with SSA to show the employee's SSN. 1o40 ez form Correctly record the employee's name and SSN. 1o40 ez form   Record the name and number of each employee as they appear on his or her social security card. 1o40 ez form If the name is not correct as shown on the card (for example, because of marriage or divorce), the employee should request a corrected card from the SSA. 1o40 ez form Continue to use the old name until the employee shows you the replacement social security card with the corrected name. 1o40 ez form   If the SSA issues the employee a replacement card after a name change, or a new card with a different social security number after a change in alien work status, file a Form W-2c to correct the name/SSN reported on the most recently filed Form W-2AS, W-2CM, W-2GU, or W-2VI. 1o40 ez form It is not necessary to correct other years if the previous name and SSN were used for years before the most recent Form W-2. 1o40 ez form Where to get and file social security number application forms. 1o40 ez form    U. 1o40 ez form S. 1o40 ez form Virgin Islands—U. 1o40 ez form S. 1o40 ez form Social Security Administration, 8000 Nisky Center, First Floor, Suite 2, St. 1o40 ez form Thomas, VI 00802. 1o40 ez form  Guam—U. 1o40 ez form S. 1o40 ez form Social Security Administration, 655 Harmon Loop Road, Suite 300, Dededo, GU 96929. 1o40 ez form  American Samoa—U. 1o40 ez form S. 1o40 ez form Social Security Administration, Pago Plaza, Suite 117, Pago Pago, AS 96799. 1o40 ez form  Commonwealth of the Northern Mariana Islands—U. 1o40 ez form S. 1o40 ez form Social Security Administration, MH Building, Suite 201, Saipan, MP 96950. 1o40 ez form Verification of social security numbers. 1o40 ez form   Employers and authorized reporting agents can use the Social Security Number Verification Service (SSNVS) to instantly verify up to 10 names and SSNs (per screen) at a time, or submit an electronic file of up to 250,000 names and SSNs and usually receive the results the next business day. 1o40 ez form Visit www. 1o40 ez form socialsecurity. 1o40 ez form gov/employer/ssnv. 1o40 ez form htm for more information. 1o40 ez form Registering for SSNVS. 1o40 ez form   You must register online and receive authorization from your employer to use SSNVS. 1o40 ez form To register, visit SSA's website at www. 1o40 ez form ssa. 1o40 ez form gov/employer and click on the Business Services Online link. 1o40 ez form Follow the registration instructions to obtain a user identification (ID) and password. 1o40 ez form You will need to provide the following information about yourself and your company. 1o40 ez form Name. 1o40 ez form SSN. 1o40 ez form Date of birth. 1o40 ez form Type of employer. 1o40 ez form EIN. 1o40 ez form Company name, address, and telephone number. 1o40 ez form Email address. 1o40 ez form   When you have completed the online registration process, SSA will mail a one-time activation code to your employer. 1o40 ez form You must enter the activation code online to use SSNVS. 1o40 ez form 4. 1o40 ez form Wages and Other Compensation Generally, all wages are subject to social security and Medicare tax (and FUTA tax for U. 1o40 ez form S. 1o40 ez form Virgin Islands employers). 1o40 ez form However, wages subject to social security tax and FUTA tax are limited by a wage base amount that you pay to each employee for the year. 1o40 ez form The wage base for social security tax is $117,000 for 2014. 1o40 ez form After you pay $117,000 to an employee in 2014, including tips, do not withhold social security tax on any amount that you later pay to the employee for the year. 1o40 ez form The wage base for FUTA tax is $7,000 for 2014. 1o40 ez form All wages are subject to Medicare tax. 1o40 ez form The wages may be in cash or in other forms, such as an automobile for personal use. 1o40 ez form Wages include salaries, vacation allowances, bonuses, commissions, and fringe benefits. 1o40 ez form It does not matter how payments are measured or paid. 1o40 ez form See the table in section 12 for exceptions to social security, Medicare, and FUTA taxes on wages. 1o40 ez form See section 5 and section 6 for a discussion of how the rules apply to tips and farmworkers. 1o40 ez form Social security and Medicare taxes apply to most payments of sick pay, including payments by third parties such as insurance companies. 1o40 ez form Special rules apply to the reporting of third-party sick pay. 1o40 ez form For details, see Publication 15-A. 1o40 ez form Determine the value of noncash pay (such as goods, lodging, and meals) by its fair market value. 1o40 ez form However, see Fringe Benefits , later in this section. 1o40 ez form Except for farmworkers and household employees, this kind of pay may be subject to social security, Medicare, and FUTA taxes. 1o40 ez form Back pay, including retroactive wage increases (but not amounts paid as liquidated damages), is taxed as ordinary wages in the year paid. 1o40 ez form For information on reporting back pay to the Social Security Administration, see Publication 957, Reporting Back Pay and Special Wage Payments to the Social Security Administration. 1o40 ez form Travel and business expenses. 1o40 ez form   Payments to your employee for travel and other necessary expenses of your business generally are included in taxable wages if (a) your employee is not required to or does not substantiate timely those expenses to you with receipts or other documentation, or (b) you advance an amount to your employee for business expenses and your employee is not required to or does not return timely any amount that he or she does not substantiate. 1o40 ez form Sick pay. 1o40 ez form   In general, sick pay is any amount that you pay, under a plan that you take part in, to an employee because of sickness or injury. 1o40 ez form These amounts are sometimes paid by a third party, such as an insurance company. 1o40 ez form In either case, these payments are subject to social security and Medicare taxes (and FUTA tax for U. 1o40 ez form S. 1o40 ez form Virgin Islands employers). 1o40 ez form Sick pay becomes exempt from these taxes after the end of 6 calendar months after the calendar month the employee last worked for the employer. 1o40 ez form Publication 15-A explains the employment tax rules that apply to sick pay, disability benefits, and similar payments to employees. 1o40 ez form Fringe Benefits Generally, fringe benefits are includible in the gross income of an employee and are subject to employment taxes. 1o40 ez form Examples of fringe benefits include the use of an automobile, aircraft flights that you provide, free or discounted commercial airline flights, vacations, discounts on property or services, memberships in country clubs or other social clubs, and tickets to entertainment or sporting events. 1o40 ez form In general, the amount included in the employee's income is the excess of the fair market value of the benefit over the sum of any amount paid for it by the employee and any amount excluded by law. 1o40 ez form For more information, see Publication 15-B, Employer's Tax Guide to Fringe Benefits. 1o40 ez form When fringe benefits are treated as paid. 1o40 ez form   You can choose to treat certain noncash fringe benefits (including personal use of an automobile provided by you) as paid by the pay period, quarter, or on any other basis that you choose, but they must be treated as paid at least annually. 1o40 ez form You do not have to make a formal choice of payment dates or notify the IRS. 1o40 ez form You do not have to use the same basis for all employees. 1o40 ez form You may change methods as often as you like, as long as all benefits provided in a calendar year are treated as paid no later than December 31 of the calendar year. 1o40 ez form However, see Special accounting rule for fringe benefits provided during November and December , later in this section. 1o40 ez form   You can treat the value of a single taxable noncash fringe benefit as paid on one or more dates in the same calendar year, even if the employee gets the entire benefit at one time. 1o40 ez form However, once you elect the payment dates, you must report the taxes on your return in the same tax period in which you treated them as paid. 1o40 ez form This election does not apply to a fringe benefit where real property or investment personal property is transferred. 1o40 ez form Withholding social security and Medicare taxes on fringe benefits. 1o40 ez form   You add the value of fringe benefits to regular wages for a payroll period and figure social security and Medicare taxes on the total. 1o40 ez form   If you withhold less than the required amount of social security and Medicare taxes from the employee in a calendar year but report and pay the proper amount, you may recover the taxes from the employee. 1o40 ez form Depositing taxes on fringe benefits. 1o40 ez form   Once you choose payment dates for taxable noncash fringe benefits, you must deposit taxes in the same deposit period that you treat the fringe benefits as paid. 1o40 ez form You may make a reasonable estimate of the value of the fringe benefits. 1o40 ez form In general, the value of taxable noncash fringe benefits provided in a calendar year must be determined by January 31 of the following year. 1o40 ez form   You may claim a refund of overpayments or elect to have any overpayment applied to the next employment tax return. 1o40 ez form If deposits are underpaid, see Deposit Penalties in section 8. 1o40 ez form Valuation of vehicles provided to employees. 1o40 ez form    If you provide a vehicle to your employees, you may either determine the actual value of the benefit for the entire calendar year, taking into account the business use of the vehicle, or consider the entire use for the calendar year as personal and include 100% of the value of the vehicle in the employee's income. 1o40 ez form For reporting information to employees, see the box 14 instructions in the General Instructions for Forms W-2 and W-3. 1o40 ez form Special accounting rule for fringe benefits provided during November and December. 1o40 ez form   You may choose to treat the value of taxable noncash fringe benefits provided during November and December as paid in the next year. 1o40 ez form However, this applies only to those benefits that you actually provided during November and December, not to those you merely treated as paid during those months. 1o40 ez form   If you use this rule, you must notify each affected employee between the time of the employee's last paycheck of the calendar year and at or near the time that you give the employee Form W-2AS, W-2CM, W-2GU, or W-2VI. 1o40 ez form If you use the special accounting rule, your employee must also use it for the same period that you use it. 1o40 ez form You cannot use this rule for a fringe benefit of real property or tangible or intangible real property of a kind normally held for investment that is transferred to your employee. 1o40 ez form 5. 1o40 ez form Tips Tips that your employee receives from customers are generally subject to social security and Medicare withholding. 1o40 ez form Your employee must report cash tips to you by the 10th of the month after the month that the tips are received. 1o40 ez form The report should include tips you paid over to the employee for charge customers, tips the employee received directly from customers, and tips received from other employees under any tip-sharing arrangement. 1o40 ez form Both directly and indirectly tipped employees must report tips to you. 1o40 ez form The report should not include tips that the employee paid out to other employees. 1o40 ez form No report is required for months when tips are less than $20. 1o40 ez form Your employees report tips on Form 4070, Employee's Report of Tips to Employer, or on a similar statement. 1o40 ez form They may also use Form 4070A, Employee's Daily Record of Tips, to keep a record of their tips. 1o40 ez form Both forms are included in Publication 1244, Employee's Daily Record of Tips and Report to Employer, available at IRS. 1o40 ez form gov. 1o40 ez form The statement must be signed by the employee and must include: The employee's name, address, and SSN, Your name and address, The month or period that the report covers, and The total tips received during the month or period. 1o40 ez form You are permitted to establish a system for electronic tip reporting by employees. 1o40 ez form See Regulations section 31. 1o40 ez form 6053-1(d). 1o40 ez form Collecting taxes on tips. 1o40 ez form   You must collect the employee social security and Medicare taxes on the employee's tips. 1o40 ez form You can also collect these taxes from the employee's wages or from other funds that he or she makes available. 1o40 ez form Stop collecting the employee social security tax when his or her total wages and tips for 2014 reach $117,000. 1o40 ez form Collect the employee Medicare tax for the whole year on all wages and tips. 1o40 ez form   You are responsible for the employer social security tax on wages and tips until the wages (including tips) reach the wage base limit. 1o40 ez form You are responsible for the employer Medicare tax for the whole year on all wages and tips. 1o40 ez form File Form 941-SS (or Form 944) to report withholding and employer taxes on tips. 1o40 ez form The withholding rules for withholding an employee's share of Medicare tax on tips also apply to withholding the Additional Medicare Tax once wages and tips exceed $200,000 in the calendar year. 1o40 ez form Ordering rule. 1o40 ez form   If, by the 10th of the month after the month you received an employee's report on tips, you do not have enough employee funds available to deduct the employee social security and Medicare tax on tips, you no longer have to collect it and are not liable for it. 1o40 ez form Reporting tips. 1o40 ez form   Report tips and any collected and uncollected social security in boxes 1, 5, 7, and 12 on Forms W-2AS, W-2CM, W-2GU, or W-2VI and on Form 941-SS, lines 5b, 5c, and 5d (Form 944, lines 4b, 4c, and 4d). 1o40 ez form Do not include any uncollected Additional Medicare Tax in box 12 of Form W-2. 1o40 ez form Report an adjustment on Form 941-SS, line 9 (Form 944, line 6), for the uncollected social security and Medicare taxes. 1o40 ez form The table in section 12 shows how tips are treated for FUTA tax purposes. 1o40 ez form   Revenue Ruling 2012-18 provides guidance for employers regarding social security and Medicare taxes imposed on tips, including information on the reporting of the employer share of social security and Medicare taxes under section 3121(q), the difference between tips and service charges, and the section 45B credit. 1o40 ez form See Revenue Ruling 2012-18, 2012-26 I. 1o40 ez form R. 1o40 ez form B. 1o40 ez form 1032, available at www. 1o40 ez form irs. 1o40 ez form gov/irb/2012-26_IRB/ar07. 1o40 ez form html. 1o40 ez form 6. 1o40 ez form Social Security and Medicare Taxes for Farmworkers The tests described below apply only to services that are defined as agricultural labor (farmwork). 1o40 ez form In general, you are an employer of farmworkers if your employees: Raise or harvest agricultural or horticultural products on your farm (including the raising and feeding of livestock); Work in connection with the operation, management, conservation, improvement, or maintenance of your farm and its tools and equipment; Provide services relating to salvaging timber, or clearing land of brush and other debris, left by a hurricane (also known as hurricane labor); Handle, process, or package any agricultural or horticultural commodity if you produced over half of the commodity (for a group of up to 20 unincorporated operators, all of the commodity); or Do work for you related to cotton ginning, turpentine, gum resin products, or the operation and maintenance of irrigation facilities. 1o40 ez form For this purpose, the term “farm” includes stock, dairy, poultry, fruit, fur-bearing animal, and truck farms, as well as plantations, ranches, nurseries, ranges, greenhouses or other similar structures used primarily for the raising of agricultural or horticultural commodities, and orchards. 1o40 ez form Farmwork does not include reselling activities that do not involve any substantial activity of raising agricultural or horticultural commodities, such as a retail store or a greenhouse used primarily for display or storage. 1o40 ez form A “share farmer” working for you is not your employee. 1o40 ez form However, the share farmer may be subject to self-employment tax. 1o40 ez form In general, share farming is an arrangement in which certain commodity products are shared between the farmer and the owner (or tenant) of the land. 1o40 ez form For details, see Regulations section 31. 1o40 ez form 3121(b)(16)-1. 1o40 ez form The $150 Test or the $2,500 Test All cash wages that you pay to any employee for farmwork are subject to social security and Medicare taxes if either of the following two tests is met. 1o40 ez form You pay cash wages to the employee of $150 or more in a year (count all cash wages paid on a time, piecework, or other basis) for farmwork. 1o40 ez form The $150 test applies separately to each farmworker that you employ. 1o40 ez form If you employ a family of workers, each member is treated separately. 1o40 ez form Do not count wages paid by other employers. 1o40 ez form The total that you pay for farmwork (cash and noncash) to all of your employees is $2,500 or more during the year. 1o40 ez form Exceptions. 1o40 ez form   The $150 and $2,500 tests do not apply to wages that you pay to a farmworker who receives less than $150 in annual cash wages and the wages are not subject to social security and Medicare taxes even if you pay $2,500 or more in that year to all of your farmworkers if the farmworker: Is employed in agriculture as a hand-harvest laborer, Is paid piece rates in an operation that is usually paid on a piece-rate basis in the region of employment, Commutes daily from his or her home to the farm, and Had been employed in agriculture less than 13 weeks in the preceding calendar year. 1o40 ez form   Amounts that you pay to these seasonal farmworkers, however, count toward the $2,500-or-more test to determine whether wages that you pay to other farmworkers are subject to social security and Medicare taxes. 1o40 ez form 7. 1o40 ez form How To Figure Social Security and Medicare Taxes The tax rate for social security is 6. 1o40 ez form 2% (amount withheld) each for the employer and employee (12. 1o40 ez form 4% total). 1o40 ez form The social security wage base limit is $117,000. 1o40 ez form The tax rate for Medicare is 1. 1o40 ez form 45% (amount withheld) each for the employee and employer (2. 1o40 ez form 9% total). 1o40 ez form There is no wage base limit for Medicare tax; all covered wages are subject to Medicare tax. 1o40 ez form Multiply each wage payment by these percentages to figure the tax to withhold from employees. 1o40 ez form Employers report both the employee and employer shares on Forms 941-SS, 944, or Form 943 (farm employment). 1o40 ez form See section 5 for information on tips. 1o40 ez form Additional Medicare Tax withholding. 1o40 ez form   In addition to withholding Medicare tax at 1. 1o40 ez form 45%, you must withhold a 0. 1o40 ez form 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. 1o40 ez form You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. 1o40 ez form Additional Medicare Tax is only imposed on the employee. 1o40 ez form There is no employer share of Additional Medicare Tax. 1o40 ez form All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold. 1o40 ez form   For more information on what wages are subject to Medicare tax, see the chart Special Rules for Various Types of Employment and Payments in section 12. 1o40 ez form For more information on Additional Medicare Tax, visit IRS. 1o40 ez form gov and enter “Additional Medicare Tax” in the search box. 1o40 ez form Deducting the tax. 1o40 ez form   Deduct the employee tax from each wage payment. 1o40 ez form If you are not sure that the wages that you pay to a farmworker during the year will be taxable, you may either deduct the tax when you make the payments or wait until the $2,500 test or the $150 test explained in section 6 has been met. 1o40 ez form Employee's portion of taxes paid by employer. 1o40 ez form   If you pay your employee's social security and Medicare taxes without deducting them from the employee's pay, you must include the amount of the payments in the employee's wages for social security and Medicare taxes. 1o40 ez form This increase in the employee's wage payment for your payment of the employee's social security and Medicare taxes is also subject to employee social security and Medicare taxes. 1o40 ez form This again increases the amount of the additional taxes that you must pay. 1o40 ez form Household and agricultural employers. 1o40 ez form   This discussion does not apply to household and agricultural employers. 1o40 ez form If you pay a household or agricultural employee's social security and Medicare taxes, these payments must be included in the employee's wages. 1o40 ez form However, this wage increase due to the tax payments is not subject to social security or Medicare taxes as discussed in this section. 1o40 ez form See Publication 15-A for details. 1o40 ez form Sick pay payments. 1o40 ez form   Social security and Medicare taxes apply to most payments of sick pay, including payments made by third parties such as insurance companies. 1o40 ez form For details on third-party payers of sick pay, see Publication 15-A. 1o40 ez form 8. 1o40 ez form Depositing Taxes You must deposit social security and Medicare taxes if your tax liability (Form 941-SS, line 10; Form 944, line 7; or Form 943, line 11) is $2,500 or more for the tax return period. 1o40 ez form You must make the deposit by electronic funds transfer. 1o40 ez form For more information about electronic funds transfers, see How To Deposit , later in this section. 1o40 ez form Payment with Return $2,500 rule. 1o40 ez form   Instead of making deposits during the current quarter, you can pay your total Form 941-SS tax liability when you timely file Form 941-SS if: Your total Form 941-SS tax liability for either the current quarter or the preceding quarter is less than $2,500 and You do not incur a $100,000 next-day deposit obligation during the current quarter. 1o40 ez form   If you are not sure your total liability for the current quarter will be less than $2,500, (and your liability for the preceding quarter was not less than $2,500), make deposits using the semiweekly or monthly rules so you won't be subject to failure to deposit penalties. 1o40 ez form Employers who have been notified to file Form 944 can pay their tax liability due for the fourth quarter with Form 944, if their fourth quarter tax liability is less than $2,500. 1o40 ez form Employers must have deposited any tax liability due for the first, second, and third quarters, according to the deposit rules, in order to avoid failure-to-deposit penalties for deposits due during those quarters. 1o40 ez form Only monthly schedule depositors are allowed to make an Accuracy of Deposits Rule payment with the return. 1o40 ez form Semiweekly schedule depositors must timely deposit the amount. 1o40 ez form See Accuracy of Deposits Rule and How To Deposit, later in this section. 1o40 ez form When To Deposit Under the rules discussed below, the only difference between farm and nonfarm workers' employment tax deposit rules is the lookback period. 1o40 ez form Therefore, farm and nonfarm workers are discussed together except where noted. 1o40 ez form Depending on your total taxes reported during a lookback period (discussed later), you are either a monthly schedule depositor or a semiweekly schedule depositor. 1o40 ez form The terms “monthly schedule depositor” and “semiweekly schedule depositor” do not refer to how often you pay your employees or how often you are required to make deposits. 1o40 ez form The terms identify which set of rules that you must follow when a tax liability arises (for example, when you have a payday). 1o40 ez form You will need to determine your deposit schedule for a calendar year based on the total employment taxes reported on Forms 941-SS, line 10; Form 944, line 7; or Form 943, line 9, for your lookback period (defined below). 1o40 ez form If you filed both Forms 941-SS and 941 during the lookback period, combine the tax liabilities for these returns for purposes of determining your deposit schedule. 1o40 ez form Determine your deposit schedule for Form 943 separately from Forms 941-SS and 941. 1o40 ez form Lookback period for employers of nonfarm workers. 1o40 ez form   The lookback period for Form 941-SS (or Form 941) consists of four quarters beginning July 1 of the second preceding year and ending June 30 of the prior year. 1o40 ez form These four quarters are your lookback period even if you did not report any taxes for any of the quarters. 1o40 ez form For 2014, the lookback period is July 1, 2012, through June 30, 2013. 1o40 ez form    Table 1. 1o40 ez form Lookback Period for Calendar Year 2014 Lookback Period July 1, 2012 Oct. 1o40 ez form 1, 2012 Jan. 1o40 ez form 1, 2013 Apr. 1o40 ez form 1, 2013 through through through through Sep. 1o40 ez form 30, 2012 Dec. 1o40 ez form 31, 2012 Mar. 1o40 ez form 31, 2013 June 30, 2013    The lookback period for Form 944 is the second calendar year preceding the current calendar year. 1o40 ez form For example, the lookback period for calendar year 2014 is calendar year 2012. 1o40 ez form In addition, for employers who filed Form 944 for 2012 or for 2013 and will file Form 941-SS (or Form 941) for 2014, the lookback period for 2014 is the second calendar year preceding the current calendar year, that is, 2012. 1o40 ez form Lookback period for employers of farmworkers. 1o40 ez form   The lookback period for Form 943 is the second calendar year preceding the current calendar year. 1o40 ez form The lookback period for calendar year 2014 is calendar year 2012. 1o40 ez form Adjustments to lookback period taxes. 1o40 ez form   To determine your taxes for the lookback period, use only the tax that you reported on the original returns (Forms 941-SS, 943, or 944). 1o40 ez form Do not include any adjustments shown on Form 941-X, 943-X, or 944-X. 1o40 ez form Example. 1o40 ez form   An employer originally reported total taxes of $45,000 for the lookback period. 1o40 ez form The employer discovered during January 2014 that the tax reported during the lookback period was understated by $10,000 and corrected this error by filing Form 941-X. 1o40 ez form The employer is a monthly schedule depositor for 2014 because the lookback period tax liabilities are based on the amounts originally reported, and they were $50,000 or less. 1o40 ez form Deposit Period The term “deposit period” refers to the period during which tax liabilities are accumulated for each required deposit due date. 1o40 ez form For monthly schedule depositors, the deposit period is a calendar month. 1o40 ez form The deposit periods for semiweekly schedule depositors are Wednesday through Friday and Saturday through Tuesday. 1o40 ez form Monthly Deposit Schedule If your total tax reported for the lookback period is $50,000 or less, you are a monthly schedule depositor for the current year. 1o40 ez form You must deposit taxes on wage payments made during a calendar month by the 15th day of the following month. 1o40 ez form New employers. 1o40 ez form   Your tax liability for any quarter in the lookback period before the date you started or acquired your business is considered to be zero. 1o40 ez form Therefore, you are a monthly schedule depositor for the first calendar year of your business (but see the $100,000 Next-Day Deposit Rule , later in this section). 1o40 ez form Semiweekly Deposit Schedule If your total tax reported for the lookback period is more than $50,000, you are a semiweekly schedule depositor for the current year. 1o40 ez form If you are a semiweekly schedule depositor, you must deposit on Wednesday and/or Friday, depending on what day of the week that you make wage payments, as follows. 1o40 ez form Deposit taxes on wage payments made on Wednesday, Thursday, and/or Friday by the following Wednesday. 1o40 ez form Deposit taxes on wage payments made on Saturday, Sunday, Monday, and/or Tuesday by the following Friday. 1o40 ez form Semiweekly depositors are generally not required to deposit twice a week if their payments were in the same semiweekly period unless the $100,000 Next-Day Deposit Rule , discussed later in this section, applies. 1o40 ez form For example, if you made a payment on both Wednesday and Friday and incurred taxes of $10,000 for each pay date, deposit the $20,000 on the following Wednesday. 1o40 ez form If you made no additional payments on Saturday through Tuesday, no deposit is due on Friday. 1o40 ez form Semiweekly deposit period spanning two quarters. 1o40 ez form   If you have more than one pay date during a semiweekly period and the pay dates fall in different calendar quarters, you will need to make separate deposits for the separate liabilities. 1o40 ez form Example. 1o40 ez form   If you have a pay date on Monday, March 31, 2014 (first quarter), and another pay date on Tuesday, April 1, 2014 (second quarter), two separate deposits will be required even though the pay dates fall within the same semiweekly period. 1o40 ez form Both deposits will be due on Friday, April 4, 2014 (3 business days from the end of the semiweekly deposit period). 1o40 ez form Examples of Monthly and Semiweekly Schedules Employers of nonfarm workers. 1o40 ez form   Rose Co. 1o40 ez form reported Form 941-SS taxes as follows: 2013 Lookback Period 3rd Quarter 2011 $12,000 4th Quarter 2011 12,000 1st Quarter 2012 12,000 2nd Quarter 2012 12,000   $48,000 2014 Lookback Period 3rd Quarter 2012 $12,000 4th Quarter 2012 12,000 1st Quarter 2013 12,000 2nd Quarter 2013 15,000   $51,000 Rose Co. 1o40 ez form is a monthly schedule depositor for 2013 because its taxes for the four quarters in its lookback period ($48,000 for the 3rd quarter of 2011 through the 2nd quarter of 2012) were not more than $50,000. 1o40 ez form However, for 2014, Rose Co. 1o40 ez form is a semiweekly schedule depositor because the total taxes for the four quarters in its lookback period ($51,000 for the 3rd quarter of 2012 through the 2nd quarter of 2013) exceeded $50,000. 1o40 ez form Employers of farmworkers. 1o40 ez form   Red Co. 1o40 ez form reported taxes on its 2012 Form 943, line 9, of $48,000. 1o40 ez form On its 2013 Form 943, line 11, it reported taxes of $60,000. 1o40 ez form   Red Co. 1o40 ez form is a monthly schedule depositor for 2014 because its taxes for its lookback period ($48,000 for calendar year 2012) were not more than $50,000. 1o40 ez form However, for 2015, Red Co. 1o40 ez form is a semiweekly schedule depositor because the total taxes for its lookback period ($60,000 for calendar year 2013) exceeded $50,000. 1o40 ez form New agricultural employers. 1o40 ez form   New agricultural employers filing Form 943 are monthly schedule depositors for the first and second calendar years of their business because their taxes for the lookback period (2 years) are considered to be zero. 1o40 ez form However, see the $100,000 Next-Day Deposit Rule , later in this section. 1o40 ez form Deposits on Business Days Only If a deposit due date falls on a day that is not a business day, the deposit is considered timely if it is made by the close of the next business day. 1o40 ez form A business day is any day other than a Saturday, Sunday, or legal holiday. 1o40 ez form For example, if a deposit is required to be made on Friday, but Friday is a legal holiday, the deposit is considered timely if it is made by the following Monday (if Monday is a business day). 1o40 ez form Semiweekly schedule depositors have at least 3 business days to make a deposit. 1o40 ez form If any of the 3 weekdays after the end of a semiweekly period is a legal holiday, you will have an additional day for each day that is a legal holiday to make the required deposit. 1o40 ez form For example, if a semiweekly schedule depositor accumulated taxes for payments made on Friday and the following Monday is a legal holiday, the deposit normally due on Wednesday may be made on Thursday (this allows 3 business days to make the deposit). 1o40 ez form Legal holiday. 1o40 ez form   The term “legal holiday” means any legal holiday in the District of Columbia. 1o40 ez form Legal holidays for 2014 are listed below. 1o40 ez form January 1—New Year's Day January 20—Birthday of Martin Luther King, Jr. 1o40 ez form February 17—Washington's Birthday April 16—District of Columbia Emancipation Day May 26—Memorial Day July 4—Independence Day September 1—Labor Day October 13—Columbus Day November 11—Veterans Day November 27—Thanksgiving Day December 25—Christmas Day Application of Monthly and Semiweekly Schedules The following examples illustrate the procedure for determining the deposit date under the two different deposit schedules. 1o40 ez form Monthly schedule example. 1o40 ez form   Spruce Co. 1o40 ez form is a monthly schedule depositor with seasonal employees. 1o40 ez form It paid wages each Friday during August but did not pay any wages during September. 1o40 ez form Under the monthly deposit schedule, Spruce Co. 1o40 ez form must deposit the combined tax liabilities for the four August paydays by September 15. 1o40 ez form Spruce Co. 1o40 ez form does not have a deposit requirement for September (due by October 15) because no wages were paid and, therefore, it did not have a tax liability for September. 1o40 ez form Semiweekly schedule example. 1o40 ez form   Green, Inc. 1o40 ez form is a semiweekly schedule depositor and pays wages once each month on the last Friday of the month. 1o40 ez form Although Green, Inc. 1o40 ez form , has a semiweekly deposit schedule, it will deposit just once a month because it pays wages only once a month. 1o40 ez form The deposit, however, will be made under the semiweekly deposit schedule as follows: Green, Inc. 1o40 ez form ’s tax liability for the April 25, 2014 (Friday), payday must be deposited by April 30, 2014 (Wednesday). 1o40 ez form Under the semiweekly deposit schedule, liabilities for wages paid on Wednesday through Friday must be deposited by the following Wednesday. 1o40 ez form $100,000 Next-Day Deposit Rule If you accumulate taxes of $100,000 or more on any day during a deposit period, you must deposit by the close of the next business day, whether you are a monthly or a semiweekly schedule depositor. 1o40 ez form For purposes of the $100,000 rule, do not continue accumulating taxes after the end of a deposit period. 1o40 ez form For example, if a semiweekly schedule depositor has accumulated taxes of $95,000 on Tuesday and $10,000 on Wednesday, the $100,000 next-day deposit rule does not apply because the $10,000 is accumulated in the next deposit period. 1o40 ez form Thus, $95,000 must be deposited by Friday and $10,000 must be deposited by the following Wednesday. 1o40 ez form However, once you accumulate at least $100,000 in a deposit period, stop accumulating at the end of that day and begin to accumulate anew on the next day. 1o40 ez form For example, Fir Co. 1o40 ez form is a semiweekly schedule depositor. 1o40 ez form On Monday, Fir Co. 1o40 ez form accumulates taxes of $110,000 and must deposit on Tuesday, the next business day. 1o40 ez form On Tuesday, Fir Co. 1o40 ez form accumulates additional taxes of $30,000. 1o40 ez form Because the $30,000 is not added to the previous $110,000 and is less than $100,000, Fir Co. 1o40 ez form does not have to deposit the $30,000 until Friday (following the semiweekly deposit schedule). 1o40 ez form If you are a monthly schedule depositor and you accumulate a $100,000 tax liability on any day during a month, you become a semiweekly schedule depositor on the next day and remain so for the remainder of the calendar year and for the following calendar year. 1o40 ez form Example. 1o40 ez form   Elm, Inc. 1o40 ez form started its business on May 1, 2014. 1o40 ez form On May 8, it paid wages for the first time and accumulated a tax liability of $40,000. 1o40 ez form On Friday, May 9, Elm, Inc. 1o40 ez form paid wages and accumulated a liability of $60,000, making its accumulated Form 941-SS tax liability total $100,000. 1o40 ez form Elm, Inc. 1o40 ez form must deposit $100,000 by Monday, May 12, the next business day. 1o40 ez form Because this was the first year of its business, the tax liability for its lookback period is considered to be zero, and it would be a monthly schedule depositor based on the lookback rules. 1o40 ez form However, because Elm, Inc. 1o40 ez form accumulated $100,000 on May 9, it became a semiweekly schedule depositor on May 10. 1o40 ez form It will be a semiweekly schedule depositor for the remainder of 2014 and for 2015. 1o40 ez form Accuracy of Deposits Rule You are required to deposit 100% of your tax liability on or before the deposit due date. 1o40 ez form However, penalties will not be applied for depositing less than 100% if both of the following conditions are met. 1o40 ez form Any deposit shortfall does not exceed the greater of $100 or 2% of the amount of taxes otherwise required to be deposited, and The deposit shortfall is paid or deposited by the shortfall makeup date as described below. 1o40 ez form Makeup date for deposit shortfall: Monthly schedule depositor. 1o40 ez form Deposit or pay the shortfall by the due date of your Form 941-SS, 944, or 943 for the period in which the shortfall occurred. 1o40 ez form You may pay the shortfall with your return even if the amount is $2,500 or more. 1o40 ez form Semiweekly schedule depositor. 1o40 ez form Deposit by the earlier of: The first Wednesday or Friday (whichever comes first) that comes on or after the 15th of the month following the month in which the shortfall occurred, or The return due date for the period in which the shortfall occurred. 1o40 ez form For example, if a semiweekly schedule depositor filing Form 941-SS has a deposit shortfall during July 2014, the shortfall makeup date is August 15, 2014 (Friday). 1o40 ez form However, if the shortfall occurred on the required April 2 (Wednesday), deposit date for a March 28 (Friday) pay date, the return due date for the March 28 pay date (April 30) would come before the May 16 (Friday) shortfall makeup date. 1o40 ez form In this case, the shortfall must be deposited by April 30, 2014. 1o40 ez form Employers of Both Farm and Nonfarm Workers If you employ both farm and nonfarm workers, you must treat employment taxes for the farmworkers (Form 943 taxes) separately from employment taxes for the nonfarm workers (Form 941-SS or 944 taxes). 1o40 ez form Form 943 taxes and Form 941-SS (or Form 944) taxes are not combined for purposes of applying any of the deposit rules. 1o40 ez form If a deposit is due, deposit the Form 941-SS (or Form 944) taxes and Form 943 taxes separately, as discussed next. 1o40 ez form How To Deposit You must deposit employment taxes by electronic funds transfer. 1o40 ez form See Payment with Return , earlier in this section, for exceptions explaining when taxes may be paid with the tax return instead of being deposited. 1o40 ez form Electronic deposit requirement. 1o40 ez form   You must use electronic funds transfer to make all federal tax deposits (such as deposits of employment tax, excise tax, and corporate income tax). 1o40 ez form Generally, electronic fund transfers are made using the Electronic Federal Tax Payment System (EFTPS). 1o40 ez form If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. 1o40 ez form   EFTPS is a free service provided by the Department of the Treasury. 1o40 ez form To get more information or to enroll in EFTPS, call 1-800-555-4477 (U. 1o40 ez form S. 1o40 ez form Virgin Islands only) or 303-967-5916 (toll call). 1o40 ez form You can also visit the EFTPS website at www. 1o40 ez form eftps. 1o40 ez form gov. 1o40 ez form Additional information about EFTPS is also available in Publication 966. 1o40 ez form When you receive your EIN. 1o40 ez form   If you are a new employer that indicated a federal tax obligation when requesting an EIN, you will be pre-enrolled in EFTPS. 1o40 ez form You will receive information about Express Enrollment in your Employer Identification Number (EIN) Package and an additional mailing containing your EFTPS personal identification number (PIN) and instructions for activating your PIN. 1o40 ez form Follow the steps in your “How to Activate Your Enrollment” brochure to activate your enrollment and begin making your payroll tax deposits. 1o40 ez form If you outsource any of your payroll and related tax duties to a third party payer, such as a payroll service provider or reporting agent, be sure to tell them about your EFTPS enrollment. 1o40 ez form Deposit record. 1o40 ez form   For your records, an Electronic Funds Transfer (EFT) Trace Number will be provided with each successful payment. 1o40 ez form The number can be used as a receipt or to trace the payment. 1o40 ez form Depositing on time. 1o40 ez form   For deposits made by EFTPS to be on time, you must initiate the deposit by 8 p. 1o40 ez form m. 1o40 ez form Eastern time the day before the date the deposit is due. 1o40 ez form If you use a third party to make deposits on your behalf, they may have different cutoff times. 1o40 ez form Same-day payment option. 1o40 ez form   If you fail to initiate a deposit transaction on EFTPS by 8 p. 1o40 ez form m. 1o40 ez form Eastern time the day before the date a deposit is due, you can still make your deposit on time by using the Federal Tax Application (FTA). 1o40 ez form To use the same-day payment method, you will need to make arrangements with your financial institution ahead of time. 1o40 ez form Please check with your financial institution regarding availability, deadlines, and costs. 1o40 ez form Your financial institution may charge you a fee for payments made this way. 1o40 ez form To learn more about the information you will need to provide your financial institution to make a same-day wire payment, please visit www. 1o40 ez form eftps. 1o40 ez form gov to download the Same-Day Payment Worksheet. 1o40 ez form How to claim credit for overpayments. 1o40 ez form   If you deposited more than the right amount of taxes for a tax period, you can choose on Form 941-SS, 941, 944, or 943 for that tax period to have the overpayment refunded or applied as a credit to your next return. 1o40 ez form Do not ask EFTPS to request a refund from the IRS for you. 1o40 ez form Deposit Penalties Penalties may apply if you do not make required deposits on time or if you make deposits of less than the required amount. 1o40 ez form The penalties do not apply if any failure to make a proper and timely deposit was due to reasonable cause and not to willful neglect. 1o40 ez form The IRS may also waive penalties if you inadvertently fail to deposit in the first quarter that a deposit is due, or the first quarter during which your frequency of deposits changed, if you timely filed your employment tax return. 1o40 ez form For amounts not properly or timely deposited, the penalty rates are as follows. 1o40 ez form 2% - Deposits made 1 to 5 days late. 1o40 ez form 5% - Deposits made 6 to 15 days late. 1o40 ez form 10% - Deposits made 16 or more days late. 1o40 ez form Also applies to amounts paid within 10 days of the date of the first notice that the IRS sent asking for the tax due. 1o40 ez form 10% - Amounts (that should have been deposited) paid directly to the IRS or paid with your tax return (but see Payment with Return , earlier in this section, for exceptions). 1o40 ez form 15% - Amounts still unpaid more than 10 days after the date of the first notice that the IRS sent asking for the tax due or the day on which you received notice and demand for immediate payment, whichever is earlier. 1o40 ez form Late deposit penalty amounts are determined using calendar days, starting from the due date of the liability. 1o40 ez form Special rule for former Form 944 filers. 1o40 ez form    If you filed Form 944 for the prior year and must file Forms 941-SS for the current year because your employment tax liability for the prior year exceeded the Form 944 eligibility requirement ($1,000 or less), the failure-to-deposit penalty will not apply to a late deposit of employment taxes for the first month of the current year if the taxes are deposited in full by March 15 of the current year. 1o40 ez form Order in which deposits are applied. 1o40 ez form   Deposits generally are applied to the most recent tax liability within the return period (quarter or year). 1o40 ez form However, if you receive a failure-to-deposit penalty notice, you may designate how your payment is to be applied in order to minimize the amount of the penalty, if you do so within 90 days of the date of the notice. 1o40 ez form Follow the instructions on the penalty notice that you received. 1o40 ez form For more information on designating deposits, see Revenue Procedure 2001-58. 1o40 ez form You can find Revenue Procedure 2001-58 on page 579 of Internal Revenue Bulletin 2001-50 at www. 1o40 ez form irs. 1o40 ez form gov/pub/irs-irbs/irb01-50. 1o40 ez form pdf. 1o40 ez form Example. 1o40 ez form Cedar, Inc. 1o40 ez form is required to make a deposit of $1,000 on July 15 and $1,500 on August 15. 1o40 ez form It does not make the deposit on July 15. 1o40 ez form On August 15, Cedar, Inc. 1o40 ez form deposits $2,000. 1o40 ez form Under the deposits rule, which applies deposits to the most recent tax liability, $1,500 of the deposit is applied to the August 15 deposit and the remaining $500 is applied to the July deposit. 1o40 ez form Accordingly, $500 of the July 15 liability remains undeposited. 1o40 ez form The penalty on this underdeposit will apply as explained earlier. 1o40 ez form Trust fund recovery penalty. 1o40 ez form   If federal income, social security, or Medicare taxes that must be withheld are not withheld or are not deposited or paid to the United States Treasury, the trust fund recovery penalty may apply. 1o40 ez form The penalty is the full amount of the unpaid trust fund tax. 1o40 ez form This penalty may apply to you if these unpaid taxes cannot be immediately collected from the employer or business. 1o40 ez form   The trust fund recovery penalty may be imposed on all persons who are determined by the IRS to be responsible for collecting, accounting for, and paying over these taxes, and who acted willfully in not doing so. 1o40 ez form   A responsible person can be an officer or employee of a corporation, a partner or employee of a partnership, an accountant, a volunteer director/trustee, or an employee of a sole proprietorship, or any other person or entity that is responsible for collecting, accounting for, and paying over trust fund taxes. 1o40 ez form A responsible person also may include one who signs checks for the business or otherwise has authority to cause the spending of business funds. 1o40 ez form    Willfully means voluntarily, consciously, and intentionally. 1o40 ez form A responsible person acts willfully if the person knows the required actions of collecting, accounting for or paying over trust fund taxes are not taking place, or recklessly disregards obvious and known risks to the government's right to receive trust fund taxes. 1o40 ez form “Averaged” failure-to-deposit penalty. 1o40 ez form   The IRS may assess an “averaged” failure-to-deposit (FTD) penalty of 2% to 10% if you are a monthly schedule depositor and did not properly complete Form 941-SS, line 14, when your tax liability shown on Form 941-SS, line 10, was $2,500 or more. 1o40 ez form IRS may also assess this penalty of 2% to 10% if you are a semiweekly schedule depositor and your tax liability shown on Form 941-SS, line 10, was $2,500 or more and you did any of the following. 1o40 ez form Completed Form 941-SS, line 14, instead of Schedule B (Form 941). 1o40 ez form Failed to attach a properly completed Schedule B (Form 941). 1o40 ez form Completed Schedule B (Form 941) incorrectly, for example, by entering tax deposits instead of tax liabilities in the numbered spaces. 1o40 ez form   The IRS figures the penalty by allocating your total tax liability shown on Form 941-SS, line 10, equally throughout the tax period. 1o40 ez form Your deposits and payments may not be counted as timely because IRS does not know the actual dates of your tax liabilities. 1o40 ez form   You can avoid the penalty by reviewing your return before filing it. 1o40 ez form Follow these steps before filing your Form 941-SS. 1o40 ez form If you are a monthly schedule depositor, report your tax liabilities (not your deposits) in the monthly entry spaces on Form 941-SS, line 14. 1o40 ez form If you are a semiweekly schedule depositor, report your tax liabilities (not your deposits) on Schedule B (Form 941) in the lines that represent the dates you paid your employees. 1o40 ez form Verify that your total liability shown on Form 941-SS, line 14, or the bottom of Schedule B (Form 941) equals your tax liability shown on Form 941-SS,  line 10. 1o40 ez form Do not show negative amounts on Form 941-SS, line 14, or Schedule B (Form 941). 1o40 ez form For prior period errors, do not adjust your tax liabilities reported on your current Form 941-SS, line 14, or on Schedule B (Form 941). 1o40 ez form Instead, file an adjusted return (Form 941-X (if you are adjusting a previously filed Form 941-SS) or Form 944-X (if you are adjusting a previously filed Form 944-SS or 944)) if you are also adjusting your tax liability. 1o40 ez form If you are only adjusting your deposits in response to a failure-to-deposit penalty notice, see the Instructions for Schedule B (Form 941) (if you previously filed Form 941-SS) or the Instructions for Form 944-X (if you previously filed Form 944-SS or 944). 1o40 ez form If you filed Form 944 for 2013 and line 7 was $2,500 or more, you were required to complete Form 944, lines 13a–13m, or attach Form 945-A, Annual Record of Federal Tax Liability. 1o40 ez form If you failed to complete lines 13a–13m, or failed to attach Form 945-A, whichever was required, IRS may assess an “averaged” failure-to-deposit (FTD) penalty. 1o40 ez form 9. 1o40 ez form Employer's Returns General instructions. 1o40 ez form   File Forms 941-SS (or Form 944) for nonfarm workers and Form 943 for farmworkers. 1o40 ez form (U. 1o40 ez form S. 1o40 ez form Virgin Islands employers may be required to file Form 940 for the combined wages of nonfarm workers and farmworkers. 1o40 ez form ) Employers with employees subject to U. 1o40 ez form S. 1o40 ez form income tax withholding. 1o40 ez form   If you have both employees who are subject to U. 1o40 ez form S. 1o40 ez form income tax withholding and employees who are not subject to U. 1o40 ez form S. 1o40 ez form income tax withholding, you must file only Form 941 (or Form 944) and include all your employees’ wages on that form. 1o40 ez form Nonfarm employers. 1o40 ez form   File Form 941-SS for the calendar quarter in which you first pay wages for nonfarm workers and for each quarter thereafter unless you are a seasonal employer or file a final return. 1o40 ez form Due dates for each quarter of the calendar year are as follows. 1o40 ez form Quarter Due Jan. 1o40 ez form , Feb. 1o40 ez form , Mar. 1o40 ez form Apr. 1o40 ez form 30 Apr. 1o40 ez form , May, June July 31 July, Aug. 1o40 ez form , Sept. 1o40 ez form Oct. 1o40 ez form 31 Oct. 1o40 ez form , Nov. 1o40 ez form , Dec. 1o40 ez form Jan. 1o40 ez form 31   However, if you deposited all taxes when due for the quarter, you have 10 additional days from the due dates to file the return. 1o40 ez form If the due date for filing your return falls on a Saturday, Sunday, or legal holiday, you may file on the next business day. 1o40 ez form   If you closed your business or stopped paying wages and do not have to file returns in the future, check the box on line 15 of your final Form 941-SS and show the date final wages were paid. 1o40 ez form Form 944. 1o40 ez form   If IRS notified you to file Form 944, file your 2013 Form 944 by January 31, 2014, or by February 10, 2014 (if you deposited all taxes when due). 1o40 ez form Household employers reporting social security and Medicare taxes. 1o40 ez form   If you are a sole proprietor and file Forms 941-SS (or Form 944) for business employees, you may include taxes for household employees on your Forms 941-SS (or Form 944). 1o40 ez form Otherwise, report social security and Medicare taxes for household employees on Schedule H (Form 1040), Household Employment Taxes. 1o40 ez form See Publication 926, Household Employer's Tax Guide, for more information. 1o40 ez form Employers of farmworkers. 1o40 ez form   Every employer of farmworkers must file a Form 943 for each calendar year beginning with the first year the employer pays $2,500 or more for farmwork or employs a farmworker who meets the $150 test described in section 6. 1o40 ez form   File a Form 943 each year for all taxable wages paid for farmwork. 1o40 ez form You may report household workers in a private home on a farm operated for profit on Form 943. 1o40 ez form Do not report wages for farmworkers on Form 941-SS or 944. 1o40 ez form   Send Form 943 to the IRS by January 31 of the following year. 1o40 ez form Send it with payment of any taxes due that you are not required to deposit. 1o40 ez form If you deposited all taxes when due, you have 10 additional days to file. 1o40 ez form Penalties. 1o40 ez form   For each whole or part month that a return is not filed when required (disregarding any extensions of the filing deadline), there is a failure-to-file penalty of 5% of the unpaid tax due with that return. 1o40 ez form The maximum penalty is generally 25% of the tax due. 1o40 ez form Also, for each whole or part month that the tax is paid late (disregarding any extensions of the payment deadline), there is a failure-to-pay penalty of 0. 1o40 ez form 5% per month of the amount of tax. 1o40 ez form For individual filers only, the failure-to-pay penalty is reduced from 0. 1o40 ez form 5% per month to 0. 1o40 ez form 25% per month if an installment agreement is in effect. 1o40 ez form You must have filed your return on or before the due date of the return to qualify for the reduced penalty. 1o40 ez form The maximum amount of the failure-to-pay penalty is also 25% of the tax due. 1o40 ez form If both penalties apply in any month, the failure-to-file penalty is reduced by the amount of the failure-to-pay penalty. 1o40 ez form The penalties will not be charged if you have a reasonable cause for failing to file or pay. 1o40 ez form If you receive a penalty notice, you can provide an explanation of why you believe reasonable cause exists. 1o40 ez form Reporting Adjustments to Form 941-SS, 944-SS, 944, or 943 Current Period Adjustments Make current period adjustments for fractions of cents, sick pay, tips, and group-term life insurance on your Form 941-SS, 944, or 943. 1o40 ez form See the Instructions for Form 941-SS, Instructions for Form 944, or Instructions for Form 943 for information on how to report these adjustments. 1o40 ez form Prior Period Adjustments Forms for prior period adjustments. 1o40 ez form   Use Form 941-X or Form 944-X to make a correction after you discover an error on a previously filed Form 941 or Form 944. 1o40 ez form There are also Forms 943-X, 945-X, and CT-1X to report corrections on the corresponding returns. 1o40 ez form Form 941-X and Form 944-X also replace Form 843, Claim for Refund and Request for Abatement, for employers to request a refund or abatement of overreported employment taxes. 1o40 ez form Continue to use Form 843 when requesting a refund or abatement of assessed interest or penalties. 1o40 ez form See Revenue Ruling 2009-39, 2009-52 I. 1o40 ez form R. 1o40 ez form B. 1o40 ez form 951, for examples of how the interest-free adjustment and claim for refund rules apply in 10 different situations. 1o40 ez form You can find Revenue Ruling 2009-39, at www. 1o40 ez form irs. 1o40 ez form gov/irb/2009-52_IRB/ar14. 1o40 ez form html. 1o40 ez form Background. 1o40 ez form   Treasury Decision 9405 changed the process for making interest-free adjustments to employment taxes reported on Forms 941-SS, 943, 944-SS, and 944, and for filing a claim for refund of employment taxes. 1o40 ez form Treasury Decision 9405, 2008-32 I. 1o40 ez form R. 1o40 ez form B. 1o40 ez form 293, is available at www. 1o40 ez form irs. 1o40 ez form gov/irb/2008-32_IRB/ar13. 1o40 ez form html. 1o40 ez form You will use the adjustment process if you underreported employment taxes and are making a payment, or if you overreported employment taxes and will be applying the credit to the Form 941-SS, 943, or 944 period during which you file Forms 941-X, 943-X, or 944-X, respectively. 1o40 ez form You will use the claim process if you overreported employment taxes and are requesting a refund or abatement of the overreported amount. 1o40 ez form We use the terms “correct” and “corrections” to include interest-free adjustments under sections 6205 and 6413, and claims for refund and abatement under sections 6402, 6414, and 6404 of the Internal Revenue Code. 1o40 ez form Correcting employment taxes. 1o40 ez form   When you discover an error on a previously filed Form 941-SS, 943, 944-SS, or 944, you must: Correct that error using Form 941-X, Form 943-X, or Form 944-X, File a separate Form 941-X, Form 943-X, or Form 944-X for
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CP 90 - Final Notice of Intent to Levy and Notice of Your Right to a Hearing

Details About This Notice:
Sample Content: Page 1, Page 2
Purpose:   We send CP 90 to inform the recipient of our intent to levy on certain assets.
Reason for Issuance:   The recipient has a balance due on their account that we've previously sent a notice about. That balance due is still unpaid. We send a CP 90 to inform the recipient that the amount is still due, that we intend to levy on certain assets, and what steps they need to take within 30 days to prevent us from taking this action.
Account Balance:   Balance Due
Possible Enclosures:  

Frequently Asked Questions About This Notice

Page Last Reviewed or Updated: 22-Apr-2013

The 1o40 Ez Form

1o40 ez form Index A Archer MSAs, Archer MSAs, Employment taxes. 1o40 ez form Assistance (see Tax help) C Contributions to FSA, Contributions to an FSA HRA, Contributions to an HRA HSA, Contributions to an HSA MSA, Contributions to an MSA D Death of HSA holder, Death of HSA Holder MSA holder, Death of the Archer MSA Holder Distributions from FSA, Distributions From an FSA HRA, Distributions From an HRA HSA, Distributions From an HSA MSA, Distributions From an MSA E Employer participation FSA, Employer Participation HRA, Employer Participation HSA, Employer Participation MSA, Employer Participation F Flexible Spending Arrangements Grace Period, Health FSA – grace period. 1o40 ez form Flexible spending arrangements, Flexible Spending Arrangements (FSAs), Employer Participation Balance in, Balance in an FSA Contributions to, Contributions to an FSA Distributions from, Distributions From an FSA Qualifying for, Qualifying for an FSA When to contribute, When To Contribute Form 5329, Excess contributions. 1o40 ez form , Excess contributions. 1o40 ez form 5498–SA, Form 8889. 1o40 ez form , Reporting Contributions on Your Return 8853, Additional tax. 1o40 ez form , Filing Form 8853 8889, Form 8889. 1o40 ez form , Additional tax. 1o40 ez form , Filing Form 8889 Free tax services, Free help with your tax return. 1o40 ez form H Health plans, high deductible, High deductible health plan (HDHP). 1o40 ez form , High deductible health plan (HDHP). 1o40 ez form Health reimbursement arrangements, Health Reimbursement Arrangements (HRAs), Employer Participation Balance in, Balance in an HRA Contributions to, Contributions to an HRA Distributions from, Distributions From an HRA Qualifying for, Qualifying for an HRA Health savings accounts, Health Savings Accounts (HSAs), Employment taxes. 1o40 ez form Balance in, Balance in an HSA Contributions to, Contributions to an HSA Deemed distributions, Deemed distributions from HSAs. 1o40 ez form Distributions from, Distributions From an HSA Last-month rule, Last-month rule. 1o40 ez form Partnerships, Reporting Contributions on Your Return Qualifying for, Qualifying for an HSA Rollovers, Rollovers S corporations, Reporting Contributions on Your Return When to contribute, When To Contribute Help (see Tax help) High deductible health plan, High deductible health plan (HDHP). 1o40 ez form , High deductible health plan (HDHP). 1o40 ez form M Medical expenses, qualified, Qualified medical expenses. 1o40 ez form , Qualified medical expenses. 1o40 ez form , Qualified medical expenses. 1o40 ez form , Qualified medical expenses. 1o40 ez form Medical savings accounts, Medical Savings Accounts (MSAs), Medicare Advantage MSAs Balance in, Balance in an Archer MSA Contributions to, Contributions to an MSA Deemed distributions, Deemed distributions from Archer MSAs. 1o40 ez form Distributions from, Distributions From an MSA Medicare Advantage MSAs, Medicare Advantage MSAs Qualifying for, Qualifying for an Archer MSA When to contribute, When To Contribute Medicare Advantage MSAs, Medicare Advantage MSAs P Preventive care, High deductible health plan (HDHP). 1o40 ez form Publications (see Tax help) Q Qualified HSA funding distribution, Qualified HSA funding distribution. 1o40 ez form T Tax help, How To Get Tax Help Testing period Last-month rule, Testing period. 1o40 ez form Qualified HSA funding distribution, Funding distribution – testing period. 1o40 ez form TTY/TDD information, How To Get Tax Help Prev  Up     Home   More Online Publications