Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Income Tax Preparation Seniors

1040 Form FreeFree State Tax Forms IncomeFile 2011 Taxes Online1040ez Forms 2014Free Taxes2012 Amended Tax ReturnEz File Tax ReturnIrs Forms 2011Irs Free Tax FilingFree Tax Filing 2013 TurbotaxIrs Gov 1040x FormFree 1040xIrs 1040ez InstructionsAmending Tax ReturnTaxact 2009File Amended Tax ReturnFederal Income Tax Form 1040ezFile 1040ez Form1040x E FileTax Return Amendment1040 EasyTax Form 1040x Free DownloadTax Forms 2011Amend 2011 Federal Return2012 Tax Filing For FreeUs Irs Tax FormsWww H & R Block1040ez BookletE File State Taxes Only1040x Amended Tax Return FormIrs Forms Amended ReturnIncome Tax Forms 2012Form 1040x 2013How Can I File My 2011 Taxes Online For FreeHow Do I File My 2010 TaxesTax Preparation SoftwareH&r Block Advantage E FileFree Online 1040ezH&r Block 1040nr2012 Amended Tax Form

Income Tax Preparation Seniors

Income tax preparation seniors Publication 503 - Introductory Material Table of Contents Future Developments Reminders IntroductionOrdering forms and publications. Income tax preparation seniors Tax questions. Income tax preparation seniors Useful Items - You may want to see: Future Developments For the latest information about developments related to Publication 503, such as legislation enacted after it was published, go to www. Income tax preparation seniors irs. Income tax preparation seniors gov/pub503. Income tax preparation seniors Reminders Taxpayer identification number needed for each qualifying person. Income tax preparation seniors  You must include on line 2 of Form 2441, Child and Dependent Care Expenses, the name and taxpayer identification number (generally the social security number) of each qualifying person. Income tax preparation seniors See Taxpayer identification number under Qualifying Person Test, later. Income tax preparation seniors You may have to pay employment taxes. Income tax preparation seniors  If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer who has to pay employment taxes. Income tax preparation seniors Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. Income tax preparation seniors See Employment Taxes for Household Employers, later. Income tax preparation seniors Photographs of missing children. Income tax preparation seniors  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Income tax preparation seniors Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Income tax preparation seniors You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Income tax preparation seniors Introduction This publication explains the tests you must meet to claim the credit for child and dependent care expenses. Income tax preparation seniors It explains how to figure and claim the credit. Income tax preparation seniors You may be able to claim the credit if you pay someone to care for your dependent who is under age 13 or for your spouse or dependent who is not able to care for himself or herself. Income tax preparation seniors The credit can be up to 35% of your expenses. Income tax preparation seniors To qualify, you must pay these expenses so you can work or look for work. Income tax preparation seniors This publication also discusses some of the employment tax rules for household employers. Income tax preparation seniors Dependent care benefits. Income tax preparation seniors   If you received any dependent care benefits from your employer during the year, you may be able to exclude from your income all or part of them. Income tax preparation seniors You must complete Form 2441, Part III, before you can figure the amount of your credit. Income tax preparation seniors See Dependent Care Benefits under How To Figure the Credit, later. Income tax preparation seniors Comments and suggestions. Income tax preparation seniors   We welcome your comments about this publication and your suggestions for future editions. Income tax preparation seniors   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Income tax preparation seniors NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Income tax preparation seniors Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Income tax preparation seniors   You can send your comments from www. Income tax preparation seniors irs. Income tax preparation seniors gov/formspubs/. Income tax preparation seniors Click on “More Information” and then on “Comment on Tax Forms and Publications. Income tax preparation seniors ”   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Income tax preparation seniors Ordering forms and publications. Income tax preparation seniors   Visit www. Income tax preparation seniors irs. Income tax preparation seniors gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Income tax preparation seniors Internal Revenue Service 1201 N. Income tax preparation seniors Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Income tax preparation seniors   If you have a tax question, check the information available on IRS. Income tax preparation seniors gov or call 1-800-829-1040. Income tax preparation seniors We cannot answer tax questions sent to either of the above addresses. Income tax preparation seniors Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 926 Household Employer's Tax Guide Form (and Instructions) 2441 Child and Dependent Care Expenses Schedule H (Form 1040) Household Employment Taxes W-10 Dependent Care Provider's Identification and Certification See How To Get Tax Help , near the end of this publication, for information about getting these publications and forms. Income tax preparation seniors Prev  Up  Next   Home   More Online Publications
Print - Click this link to Print this page

IRS Combats Identity Theft and Refund Fraud on Many Fronts

IRS YouTube Videos
ID Theft: IRS Efforts on Identity Theft

FS-2014-1, January 2014

Stopping identity theft and refund fraud is a top priority for the Internal Revenue Service (IRS). The agency’s work on identity theft and refund fraud continues to grow, touching nearly every part of the organization. For the 2014 filing season, the IRS has expanded these efforts to better protect taxpayers and help victims.

The IRS assigned more than 3,000 IRS employees to work on identity theft-related issues. IRS employees are working to prevent refund fraud, investigate identity theft-related crimes and help taxpayers who have been victimized by identity thieves. In addition, the IRS provides training to more than 35,000 employees who work with taxpayers to recognize identity theft indicators and help people victimized by identity theft.

Refund Fraud Detection and Prevention

The IRS continues to increase its efforts against refund fraud, which includes identity theft. As a result of these aggressive efforts to combat identity theft from 2011 through November 2013, the IRS has stopped 14.6 million suspicious returns, and protected over $50 billion in fraudulent refunds.

For 2014, the IRS will continue to increase both the number and efficiency of the identity theft filters that are used to identify potentially fraudulent returns due to identity theft prior to the processing of the return and release of any refund. 

In Fiscal Year 2013, the IRS initiated 1,492 identity theft related criminal investigations, an increase of 66 percent over investigations initiated in FY 2012. Indictments and sentencing doubled in FY 2013 and the average prison term was more than three years (38 months) – the longest sentenced being 26 years.   

Increasing Efforts to Help Victims

The IRS understands that identity theft is a frustrating, complex process for victims. While identity thieves steal information from sources outside the tax system, the IRS is often the first to inform a victim that identity theft has occurred. The IRS is working hard to resolve identity theft cases as quickly as possible.  We are also developing programs and information to protect the taxpayer from future misuse of their personal information impacting their tax administration and minimize the impact outside of IRS.

While the IRS has made considerable progress in this area, more work remains. Fighting identity theft is an ongoing battle as identity thieves continue to create new ways of stealing personal information and using it for their gain. Identity theft cases are among the most complex handled by the IRS. The IRS is continually reviewing processes and policies to minimize the incidence of identity theft and to help those who find themselves victimized. Among the steps underway to help victims:

  • IP PIN expansion. The IRS Identity Protection PIN (IP PIN) is a unique six digit number that is assigned annually to victims of identity theft for use when filing their federal tax return that shows that a particular taxpayer is the rightful filer of the return. For the upcoming tax year 2013 filing season, the IRS expects to provide more than 1.2 million taxpayers with an IP PIN. For the second tax season in a row, the number of IP PINs has nearly doubled from the year before. The IP PIN will allow these individuals to avoid delays in filing returns and receiving refunds.
  • IP PIN Changes:
    • If an IP PIN is assigned to a taxpayer for their 2013 return, the IP PIN must be used on any delinquent 2011 and 2012 returns filed during the 2014 calendar year.
    • IRS is exploring the use of an online process through IRS.gov that will allow taxpayers who have an IP PIN requirement and lose their IP PIN to create an account and receive their original IP PIN online. 
  • Victim case resolution:  The IRS continues to dedicate more and more employees to resolution of victim cases. These are extremely complex cases to resolve, frequently touching on multiple issues and multiple tax years. Cases of resolving identity theft can be complicated by the thieves themselves contacting the IRS. The IRS is working hard to streamline its internal process, but much more work remains. A typical case can take 180 days to resolve, and the IRS is working to reduce that time period.
  • Service options. The IRS is providing information in several ways ranging from a special section on IRS.gov devoted to identity theft to a special phone number available for victims to obtain assistance and resource information for resolving tax issues. The IRS Identity Protection Specialized Unit is available at 1-800-908-4490.
  • More information is available on IRS.gov, including the Taxpayer Guide to Identity Theft.

IRS Criminal Investigation

In FY 2013, the IRS initiated 1,492 identity theft related criminal investigations, an increase of 66% over investigations initiated in FY 2012. Indictments and sentencing doubled in FY 2013 and the average prison term was more than three years (38 months).

In January 2013, the IRS conducted a coordinated and highly successful identity theft enforcement sweep.  The coast-to-coast effort against identity theft suspects led to 734 enforcement actions, including 298 indictments, informations, complaints and arrests.

The Law Enforcement Assistance Program, formerly known as the Identity Theft Pilot Disclosure Program, was expanded nationwide.  This program provides for the disclosure of federal tax return information associated with the accounts of known and suspected victims of identity theft with the express written consent of those victims.  There are currently more than 300 state/local law enforcement agencies from 35 states participating.  For FY 2013, more than 2,400 requests were received from state and local law enforcement agencies.

The Identity Theft Clearinghouse (ITC) continues to develop and refer identity theft refund fraud schemes to Criminal Investigation (CI) Field Offices for investigation.  For FY 2013, the ITC received over 1,400 identity theft related leads.  Those leads related to more than 391,000 tax returns claiming in excess of $1.3 billion dollars in potentially fraudulent federal income tax refunds. 

CI continues to be the lead agency or actively involved in more than 30 multi-regional task forces or working groups including state/local and federal law enforcement agencies solely focusing on identity theft.     

For more information, see the special identity theft section on IRS.gov and IRS Fact Sheet 2014-2, Tips for Taxpayers and Victims about Identity Theft and Tax Returns.

Page Last Reviewed or Updated: 07-Jan-2014

The Income Tax Preparation Seniors

Income tax preparation seniors Publication 15 - Main Content Table of Contents 1. Income tax preparation seniors Employer Identification Number (EIN) 2. Income tax preparation seniors Who Are Employees?Relief provisions. Income tax preparation seniors Business Owned and Operated by Spouses 3. Income tax preparation seniors Family Employees 4. Income tax preparation seniors Employee's Social Security Number (SSN)Registering for SSNVS. Income tax preparation seniors 5. Income tax preparation seniors Wages and Other CompensationAccountable plan. Income tax preparation seniors Nonaccountable plan. Income tax preparation seniors Per diem or other fixed allowance. Income tax preparation seniors 50% test. Income tax preparation seniors Health Savings Accounts and medical savings accounts. Income tax preparation seniors Nontaxable fringe benefits. Income tax preparation seniors When fringe benefits are treated as paid. Income tax preparation seniors Valuation of fringe benefits. Income tax preparation seniors Withholding on fringe benefits. Income tax preparation seniors Depositing taxes on fringe benefits. Income tax preparation seniors 6. Income tax preparation seniors TipsOrdering rule. Income tax preparation seniors 7. Income tax preparation seniors Supplemental Wages 8. Income tax preparation seniors Payroll Period 9. Income tax preparation seniors Withholding From Employees' WagesIncome Tax Withholding Social Security and Medicare Taxes Part-Time Workers 10. Income tax preparation seniors Required Notice to Employees About the Earned Income Credit (EIC) 11. Income tax preparation seniors Depositing TaxesWhen To Deposit How To Deposit Deposit Penalties 12. Income tax preparation seniors Filing Form 941 or Form 944 13. Income tax preparation seniors Reporting Adjustments to Form 941 or Form 944Current Period Adjustments Prior Period Adjustments Wage Repayments 14. Income tax preparation seniors Federal Unemployment (FUTA) TaxSuccessor employer. Income tax preparation seniors Household employees. Income tax preparation seniors When to deposit. Income tax preparation seniors Household employees. Income tax preparation seniors Electronic filing by reporting agents. Income tax preparation seniors 16. Income tax preparation seniors How To Use the Income Tax Withholding TablesWage Bracket Method Percentage Method Alternative Methods of Income Tax Withholding How To Get Tax Help 1. Income tax preparation seniors Employer Identification Number (EIN) If you are required to report employment taxes or give tax statements to employees or annuitants, you need an EIN. Income tax preparation seniors The EIN is a nine-digit number the IRS issues. Income tax preparation seniors The digits are arranged as follows: 00-0000000. Income tax preparation seniors It is used to identify the tax accounts of employers and certain others who have no employees. Income tax preparation seniors Use your EIN on all of the items you send to the IRS and SSA. Income tax preparation seniors For more information, see Publication 1635, Employer Identification Number: Understanding Your EIN. Income tax preparation seniors If you do not have an EIN, you may apply for one online. Income tax preparation seniors Go to the IRS. Income tax preparation seniors gov and click on the Apply for an EIN Online link under Tools. Income tax preparation seniors You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. Income tax preparation seniors Do not use an SSN in place of an EIN. Income tax preparation seniors You should have only one EIN. Income tax preparation seniors If you have more than one and are not sure which one to use, call 1-800-829-4933 or 1-800-829-4059 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability). Income tax preparation seniors Give the numbers you have, the name and address to which each was assigned, and the address of your main place of business. Income tax preparation seniors The IRS will tell you which number to use. Income tax preparation seniors If you took over another employer's business (see Successor employer in section 9), do not use that employer's EIN. Income tax preparation seniors If you have applied for an EIN but do not have your EIN by the time a return is due, file a paper return and write “Applied For” and the date you applied for it in the space shown for the number. Income tax preparation seniors 2. Income tax preparation seniors Who Are Employees? Generally, employees are defined either under common law or under statutes for certain situations. Income tax preparation seniors See Publication 15-A for details on statutory employees and nonemployees. Income tax preparation seniors Employee status under common law. Income tax preparation seniors   Generally, a worker who performs services for you is your employee if you have the right to control what will be done and how it will be done. Income tax preparation seniors This is so even when you give the employee freedom of action. Income tax preparation seniors What matters is that you have the right to control the details of how the services are performed. Income tax preparation seniors See Publication 15-A for more information on how to determine whether an individual providing services is an independent contractor or an employee. Income tax preparation seniors   Generally, people in business for themselves are not employees. Income tax preparation seniors For example, doctors, lawyers, veterinarians, and others in an independent trade in which they offer their services to the public are usually not employees. Income tax preparation seniors However, if the business is incorporated, corporate officers who work in the business are employees of the corporation. Income tax preparation seniors   If an employer-employee relationship exists, it does not matter what it is called. Income tax preparation seniors The employee may be called an agent or independent contractor. Income tax preparation seniors It also does not matter how payments are measured or paid, what they are called, or if the employee works full or part time. Income tax preparation seniors Statutory employees. Income tax preparation seniors   If someone who works for you is not an employee under the common law rules discussed earlier, do not withhold federal income tax from his or her pay, unless backup withholding applies. Income tax preparation seniors Although the following persons may not be common law employees, they are considered employees by statute for social security, Medicare, and FUTA tax purposes under certain conditions. Income tax preparation seniors An agent (or commission) driver who delivers food, beverages (other than milk), laundry, or dry cleaning for someone else. Income tax preparation seniors A full-time life insurance salesperson who sells primarily for one company. Income tax preparation seniors A homeworker who works by 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. Income tax preparation seniors 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. Income tax preparation seniors The orders must be for merchandise for resale or supplies for use in the customer's business. Income tax preparation seniors The customers must be retailers, wholesalers, contractors, or operators of hotels, restaurants, or other businesses dealing with food or lodging. Income tax preparation seniors    Statutory nonemployees. Income tax preparation seniors   Direct sellers, qualified real estate agents, and certain companion sitters are, by law, considered nonemployees. Income tax preparation seniors They are generally treated as self-employed for all federal tax purposes, including income and employment taxes. Income tax preparation seniors H-2A agricultural workers. Income tax preparation seniors   On Form W-2, do not check box 13 (Statutory employee), as H-2A workers are not statutory employees. Income tax preparation seniors Treating employees as nonemployees. Income tax preparation seniors   You will generally be liable for social security and Medicare taxes and withheld income tax if you do not deduct and withhold these taxes because you treated an employee as a nonemployee. Income tax preparation seniors You may be able to calculate your liability using special section 3509 rates for the employee share of social security and Medicare taxes and the federal income tax withholding. Income tax preparation seniors The applicable rates depend on whether you filed required Forms 1099. Income tax preparation seniors You cannot recover the employee share of social security, or Medicare tax, or income tax withholding from the employee if the tax is paid under section 3509. Income tax preparation seniors You are liable for the income tax withholding regardless of whether the employee paid income tax on the wages. Income tax preparation seniors You continue to owe the full employer share of social security and Medicare taxes. Income tax preparation seniors The employee remains liable for the employee share of social security and Medicare taxes. Income tax preparation seniors See Internal Revenue Code section 3509 for details. Income tax preparation seniors Also see the Instructions for Form 941-X. Income tax preparation seniors   Section 3509 rates are not available if you intentionally disregard the requirement to withhold taxes from the employee or if you withheld income taxes but not social security or Medicare taxes. Income tax preparation seniors Section 3509 is not available for reclassifying statutory employees. Income tax preparation seniors See Statutory employees , earlier in this section. Income tax preparation seniors   If the employer issued required information returns, the section 3509 rates are: For social security taxes; employer rate of 6. Income tax preparation seniors 2% plus 20% of the employee rate (see the Instructions for Form 941-X). Income tax preparation seniors For Medicare taxes; employer rate of 1. Income tax preparation seniors 45% plus 20% of the employee rate of 1. Income tax preparation seniors 45%, for a total rate of 1. Income tax preparation seniors 74% of wages. Income tax preparation seniors For Additional Medicare Tax; 0. Income tax preparation seniors 18% (20% of the employee rate of 0. Income tax preparation seniors 9%) of wages subject to Additional Medicare Tax. Income tax preparation seniors For income tax withholding, the rate is 1. Income tax preparation seniors 5% of wages. Income tax preparation seniors   If the employer did not issue required information returns, the section 3509 rates are: For social security taxes; employer rate of 6. Income tax preparation seniors 2% plus 40% of the employee rate (see the Instructions for Form 941-X). Income tax preparation seniors For Medicare taxes; employer rate of 1. Income tax preparation seniors 45% plus 40% of the employee rate of 1. Income tax preparation seniors 45%, for a total rate of 2. Income tax preparation seniors 03% of wages. Income tax preparation seniors For Additional Medicare Tax; 0. Income tax preparation seniors 36% (40% of the employee rate of 0. Income tax preparation seniors 9%) of wages subject to Additional Medicare Tax. Income tax preparation seniors For income tax withholding, the rate is 3. Income tax preparation seniors 0% of wages. Income tax preparation seniors Relief provisions. Income tax preparation seniors   If you have a reasonable basis for not treating a worker as an employee, you may be relieved from having to pay employment taxes for that worker. Income tax preparation seniors To get this relief, you must file all required federal tax returns, including information returns, on a basis consistent with your treatment of the worker. Income tax preparation seniors You (or your predecessor) must not have treated any worker holding a substantially similar position as an employee for any periods beginning after 1977. Income tax preparation seniors See Publication 1976, Do You Qualify for Relief Under Section 530. Income tax preparation seniors IRS help. Income tax preparation seniors   If you want the IRS to determine whether a worker is an employee, file Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. Income tax preparation seniors Voluntary Classification Settlement Program (VCSP). Income tax preparation seniors   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. Income tax preparation seniors To apply, use Form 8952, Application for Voluntary Classification Settlement Program (VCSP). Income tax preparation seniors For more information visit IRS. Income tax preparation seniors gov and enter “VCSP” in the search box. Income tax preparation seniors 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. Income tax preparation seniors See Publication 541, Partnerships, for more details. Income tax preparation seniors The partnership is considered the employer of any employees, and is liable for any employment taxes due on wages paid to its employees. Income tax preparation seniors Exception—Qualified joint venture. Income tax preparation seniors   For tax years beginning after December 31, 2006, the Small Business and Work Opportunity Tax Act of 2007 (Public Law 110-28) provides that a “qualified joint venture,” whose only members are spouses filing a joint income tax return, can elect not to be treated as a partnership for federal tax purposes. Income tax preparation seniors A qualified joint venture conducts a trade or business where: The only members of the joint venture are spouses who file a joint income tax return, Both spouses materially participate (see Material participation in the Instructions for Schedule C (Form 1040), line G) in the trade or business (mere joint ownership of property is not enough), Both spouses elect to not be treated as a partnership, and The business is co-owned by both spouses and is not held in the name of a state law entity such as a partnership or limited liability company (LLC). Income tax preparation seniors   To make the election, all items of income, gain, loss, deduction, and credit must be divided between the spouses, in accordance with each spouse's interest in the venture, and reported on separate Schedules C or F as sole proprietors. Income tax preparation seniors Each spouse must also file a separate Schedule SE to pay self-employment taxes, as applicable. Income tax preparation seniors   Spouses using the qualified joint venture rules are treated as sole proprietors for federal tax purposes and generally do not need an EIN. Income tax preparation seniors If employment taxes are owed by the qualified joint venture, either spouse may report and pay the employment taxes due on the wages paid to the employees using the EIN of that spouse's sole proprietorship. Income tax preparation seniors Generally, filing as a qualified joint venture will not increase the spouses' total tax owed on the joint income tax return. Income tax preparation seniors However, it gives each spouse credit for social security earnings on which retirement benefits are based and for Medicare coverage without filing a partnership return. Income tax preparation seniors    Note. Income tax preparation seniors If your spouse is your employee, not your partner, see One spouse employed by another in section 3. Income tax preparation seniors   For more information on qualified joint ventures, visit IRS. Income tax preparation seniors gov and enter “qualified joint venture” in the search box. Income tax preparation seniors Exception—Community income. Income tax preparation seniors   If you and your spouse wholly own an unincorporated business as community property under the community property laws of a state, foreign country, or U. Income tax preparation seniors S. Income tax preparation seniors possession, you can treat the business either as a sole proprietorship (of the spouse who carried on the business) or a partnership. Income tax preparation seniors You may still make an election to be taxed as a qualified joint venture instead of a partnership. Income tax preparation seniors See Exception—Qualified joint venture , earlier. Income tax preparation seniors 3. Income tax preparation seniors Family Employees Child employed by parents. Income tax preparation seniors   Payments for the services of a child under age 18 who works for his or her parent in a trade or business are not subject to social security and Medicare taxes if the trade or business is a sole proprietorship or a partnership in which each partner is a parent of the child. Income tax preparation seniors If these payments are for work other than in a trade or business, such as domestic work in the parent's private home, they are not subject to social security and Medicare taxes until the child reaches age 21. Income tax preparation seniors However, see Covered services of a child or spouse , later in this section. Income tax preparation seniors Payments for the services of a child under age 21 who works for his or her parent, whether or not in a trade or business, are not subject to FUTA tax. Income tax preparation seniors Payments for the services of a child of any age who works for his or her parent are generally subject to income tax withholding unless the payments are for domestic work in the parent's home, or unless the payments are for work other than in a trade or business and are less than $50 in the quarter or the child is not regularly employed to do such work. Income tax preparation seniors One spouse employed by another. Income tax preparation seniors   The wages for the services of an individual who works for his or her spouse in a trade or business are subject to income tax withholding and social security and Medicare taxes, but not to FUTA tax. Income tax preparation seniors However, the payments for services of one spouse employed by another in other than a trade or business, such as domestic service in a private home, are not subject to social security, Medicare, and FUTA taxes. Income tax preparation seniors Covered services of a child or spouse. Income tax preparation seniors   The wages for the services of a child or spouse are subject to income tax withholding as well as social security, Medicare, and FUTA taxes if he or she works for: A corporation, even if it is controlled by the child's parent or the individual's spouse; A partnership, even if the child's parent is a partner, unless each partner is a parent of the child; A partnership, even if the individual's spouse is a partner; or An estate, even if it is the estate of a deceased parent. Income tax preparation seniors Parent employed by son or daughter. Income tax preparation seniors   When the employer is a son or daughter employing his or her parent the following rules apply. Income tax preparation seniors Payments for the services of a parent in the son’s or daughter’s (the employer’s) trade or business are subject to income tax withholding and social security and Medicare taxes. Income tax preparation seniors Payments for the services of a parent not in the son’s or daughter’s (the employer’s) trade or business are generally not subject to social security and Medicare taxes. Income tax preparation seniors    Social security and Medicare taxes do apply to payments made to a parent for domestic services if all of the following apply: The parent is employed by his or her son or daughter; The son or daughter (the employer) has a child or stepchild living in the home; The son or daughter (the employer) is a widow or widower, divorced, or living with a spouse who, because of a mental or physical condition, cannot care for the child or stepchild for at least 4 continuous weeks in a calendar quarter; and The child or stepchild is either under age 18 or requires the personal care of an adult for at least 4 continuous weeks in a calendar quarter due to a mental or physical condition. Income tax preparation seniors   Payments made to a parent employed by his or her child are not subject to FUTA tax, regardless of the type of services provided. Income tax preparation seniors 4. Income tax preparation seniors Employee's Social Security Number (SSN) You are required to get each employee's name and SSN and to enter them on Form W-2. Income tax preparation seniors This requirement also applies to resident and nonresident alien employees. Income tax preparation seniors You should ask your employee to show you his or her social security card. Income tax preparation seniors The employee may show the card if it is available. Income tax preparation seniors Do not accept a social security card that says “Not valid for employment. Income tax preparation seniors ” A social security number issued with this legend does not permit employment. Income tax preparation seniors You may, but are not required to, photocopy the social security card if the employee provides it. Income tax preparation seniors If you do not provide the correct employee name and SSN on Form W-2, you may owe a penalty unless you have reasonable cause. Income tax preparation seniors See Publication 1586, Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs, for information on the requirement to solicit the employee's SSN. Income tax preparation seniors Applying for a social security card. Income tax preparation seniors   Any employee who is legally eligible to work in the United States and does not have a social security card can get one by completing Form SS-5, Application for a Social Security Card, and submitting the necessary documentation. Income tax preparation seniors You can get Form SS-5 at SSA offices, by calling 1-800-772-1213, or from the SSA website at www. Income tax preparation seniors socialsecurity. Income tax preparation seniors gov/online/ss-5. Income tax preparation seniors html. Income tax preparation seniors The employee must complete and sign Form SS-5; it cannot be filed by the employer. Income tax preparation seniors 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. Income tax preparation seniors Applying for a social security number. Income tax preparation seniors   If you file Form W-2 on paper and your employee applied for an SSN but does not have one when you must file Form W-2, enter “Applied For” on the form. Income tax preparation seniors If you are filing electronically, enter all zeros (000-00-000) in the social security number field. Income tax preparation seniors When the employee receives the SSN, file Copy A of Form W-2c, Corrected Wage and Tax Statement, with the SSA to show the employee's SSN. Income tax preparation seniors Furnish copies B, C, and 2 of Form W-2c to the employee. Income tax preparation seniors Up to 25 Forms W-2c for each Form W-3c, Transmittal of Corrected Wage and Tax Statements, may now be filed per session over the Internet, with no limit on the number of sessions. Income tax preparation seniors For more information, visit the SSA's Employer W-2 Filing Instructions & Information webpage at www. Income tax preparation seniors socialsecurity. Income tax preparation seniors gov/employer. Income tax preparation seniors Advise your employee to correct the SSN on his or her original Form W-2. Income tax preparation seniors Correctly record the employee's name and SSN. Income tax preparation seniors   Record the name and number of each employee as they are shown on the employee's social security card. Income tax preparation seniors If the employee's 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. Income tax preparation seniors Continue to report the employee's wages under the old name until the employee shows you an updated social security card with the new name. Income tax preparation seniors 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 for the most recently filed Form W-2. Income tax preparation seniors It is not necessary to correct other years if the previous name and number were used for years before the most recent Form W-2. Income tax preparation seniors IRS individual taxpayer identification numbers (ITINs) for aliens. Income tax preparation seniors   Do not accept an ITIN in place of an SSN for employee identification or for work. Income tax preparation seniors An ITIN is only available to resident and nonresident aliens who are not eligible for U. Income tax preparation seniors S. Income tax preparation seniors employment and need identification for other tax purposes. Income tax preparation seniors You can identify an ITIN because it is a nine-digit number, beginning with the number “9” with either a “7” or “8” as the fourth digit and is formatted like an SSN (for example, 9NN-7N-NNNN). Income tax preparation seniors    An individual with an ITIN who later becomes eligible to work in the United States must obtain an SSN. Income tax preparation seniors If the individual is currently eligible to work in the United States, instruct the individual to apply for an SSN and follow the instructions under Applying for a social security number, earlier. Income tax preparation seniors Do not use an ITIN in place of an SSN on Form W-2. Income tax preparation seniors Verification of social security numbers. Income tax preparation seniors   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. Income tax preparation seniors Visit www. Income tax preparation seniors socialsecurity. Income tax preparation seniors gov/employer/ssnv. Income tax preparation seniors htm for more information. Income tax preparation seniors Registering for SSNVS. Income tax preparation seniors   You must register online and receive authorization from your employer to use SSNVS. Income tax preparation seniors To register, visit SSA's website at www. Income tax preparation seniors ssa. Income tax preparation seniors gov/employer and click on the Business Services Online link. Income tax preparation seniors Follow the registration instructions to obtain a user identification (ID) and password. Income tax preparation seniors You will need to provide the following information about yourself and your company. Income tax preparation seniors Name. Income tax preparation seniors SSN. Income tax preparation seniors Date of birth. Income tax preparation seniors Type of employer. Income tax preparation seniors EIN. Income tax preparation seniors Company name, address, and telephone number. Income tax preparation seniors Email address. Income tax preparation seniors   When you have completed the online registration process, SSA will mail a one-time activation code to your employer. Income tax preparation seniors You must enter the activation code online to use SSNVS. Income tax preparation seniors 5. Income tax preparation seniors Wages and Other Compensation Wages subject to federal employment taxes generally include all pay you give to an employee for services performed. Income tax preparation seniors The pay may be in cash or in other forms. Income tax preparation seniors It includes salaries, vacation allowances, bonuses, commissions, and fringe benefits. Income tax preparation seniors It does not matter how you measure or make the payments. Income tax preparation seniors Amounts an employer pays as a bonus for signing or ratifying a contract in connection with the establishment of an employer-employee relationship and an amount paid to an employee for cancellation of an employment contract and relinquishment of contract rights are wages subject to social security, Medicare, and FUTA taxes and income tax withholding. Income tax preparation seniors Also, compensation paid to a former employee for services performed while still employed is wages subject to employment taxes. Income tax preparation seniors More information. Income tax preparation seniors   See section 6 for a discussion of tips and section 7 for a discussion of supplemental wages. Income tax preparation seniors Also, see section 15 for exceptions to the general rules for wages. Income tax preparation seniors Publication 15-A provides additional information on wages, including nonqualified deferred compensation, and other compensation. Income tax preparation seniors Publication 15-B provides information on other forms of compensation, including: Accident and health benefits, Achievement awards, Adoption assistance, Athletic facilities, De minimis (minimal) benefits, Dependent care assistance, Educational assistance, Employee discounts, Employee stock options, Employer-provided cell phones, Group-term life insurance coverage, Health Savings Accounts, Lodging on your business premises, Meals, Moving expense reimbursements, No-additional-cost services, Retirement planning services, Transportation (commuting) benefits, Tuition reduction, and Working condition benefits. Income tax preparation seniors Employee business expense reimbursements. Income tax preparation seniors   A reimbursement or allowance arrangement is a system by which you pay the advances, reimbursements, and charges for your employees' business expenses. Income tax preparation seniors How you report a reimbursement or allowance amount depends on whether you have an accountable or a nonaccountable plan. Income tax preparation seniors If a single payment includes both wages and an expense reimbursement, you must specify the amount of the reimbursement. Income tax preparation seniors   These rules apply to all ordinary and necessary employee business expenses that would otherwise qualify for a deduction by the employee. Income tax preparation seniors Accountable plan. Income tax preparation seniors   To be an accountable plan, your reimbursement or allowance arrangement must require your employees to meet all three of the following rules. Income tax preparation seniors They must have paid or incurred deductible expenses while performing services as your employees. Income tax preparation seniors The reimbursement or advance must be paid for the expense and must not be an amount that would have otherwise been paid by the employee. Income tax preparation seniors They must substantiate these expenses to you within a reasonable period of time. Income tax preparation seniors They must return any amounts in excess of substantiated expenses within a reasonable period of time. Income tax preparation seniors   Amounts paid under an accountable plan are not wages and are not subject to income, social security, Medicare, and FUTA taxes. Income tax preparation seniors   If the expenses covered by this arrangement are not substantiated (or amounts in excess of substantiated expenses are not returned within a reasonable period of time), the amount paid under the arrangement in excess of the substantiated expenses is treated as paid under a nonaccountable plan. Income tax preparation seniors This amount is subject to income, social security, Medicare, and FUTA taxes for the first payroll period following the end of the reasonable period of time. Income tax preparation seniors   A reasonable period of time depends on the facts and circumstances. Income tax preparation seniors Generally, it is considered reasonable if your employees receive their advance within 30 days of the time they incur the expenses, adequately account for the expenses within 60 days after the expenses were paid or incurred, and return any amounts in excess of expenses within 120 days after the expenses were paid or incurred. Income tax preparation seniors Also, it is considered reasonable if you give your employees a periodic statement (at least quarterly) that asks them to either return or adequately account for outstanding amounts and they do so within 120 days. Income tax preparation seniors Nonaccountable plan. Income tax preparation seniors   Payments to your employee for travel and other necessary expenses of your business under a nonaccountable plan are wages and are treated as supplemental wages and subject to income, social security, Medicare, and FUTA taxes. Income tax preparation seniors Your payments are treated as paid under a nonaccountable plan if: Your employee is not required to or does not substantiate timely those expenses to you with receipts or other documentation, You advance an amount to your employee for business expenses and your employee is not required to or does not return timely any amount he or she does not use for business expenses, You advance or pay an amount to your employee regardless of whether you reasonably expect the employee to have business expenses related to your business, or You pay an amount as a reimbursement you would have otherwise paid as wages. Income tax preparation seniors   See section 7 for more information on supplemental wages. Income tax preparation seniors Per diem or other fixed allowance. Income tax preparation seniors   You may reimburse your employees by travel days, miles, or some other fixed allowance under the applicable revenue procedure. Income tax preparation seniors In these cases, your employee is considered to have accounted to you if your reimbursement does not exceed rates established by the Federal Government. Income tax preparation seniors The 2013 standard mileage rate for auto expenses was 56. Income tax preparation seniors 5 cents per mile. Income tax preparation seniors The rate for 2014 is 56 cents per mile. Income tax preparation seniors   The government per diem rates for meals and lodging in the continental United States are listed in Publication 1542, Per Diem Rates. Income tax preparation seniors Other than the amount of these expenses, your employees' business expenses must be substantiated (for example, the business purpose of the travel or the number of business miles driven). Income tax preparation seniors   If the per diem or allowance paid exceeds the amounts substantiated, you must report the excess amount as wages. Income tax preparation seniors This excess amount is subject to income tax withholding and payment of social security, Medicare, and FUTA taxes. Income tax preparation seniors Show the amount equal to the substantiated amount (for example, the nontaxable portion) in box 12 of Form W-2 using code “L. Income tax preparation seniors ” Wages not paid in money. Income tax preparation seniors   If in the course of your trade or business you pay your employees in a medium that is neither cash nor a readily negotiable instrument, such as a check, you are said to pay them “in kind. Income tax preparation seniors ” Payments in kind may be in the form of goods, lodging, food, clothing, or services. Income tax preparation seniors Generally, the fair market value of such payments at the time they are provided is subject to federal income tax withholding and social security, Medicare, and FUTA taxes. Income tax preparation seniors   However, noncash payments for household work, agricultural labor, and service not in the employer's trade or business are exempt from social security, Medicare, and FUTA taxes. Income tax preparation seniors Withhold income tax on these payments only if you and the employee agree to do so. Income tax preparation seniors Nonetheless, noncash payments for agricultural labor, such as commodity wages, are treated as cash payments subject to employment taxes if the substance of the transaction is a cash payment. Income tax preparation seniors Moving expenses. Income tax preparation seniors   Reimbursed and employer-paid qualified moving expenses (those that would otherwise be deductible by the employee) paid under an accountable plan are not includible in an employee's income unless you have knowledge the employee deducted the expenses in a prior year. Income tax preparation seniors Reimbursed and employer-paid nonqualified moving expenses are includible in income and are subject to employment taxes and income tax withholding. Income tax preparation seniors For more information on moving expenses, see Publication 521, Moving Expenses. Income tax preparation seniors Meals and lodging. Income tax preparation seniors   The value of meals is not taxable income and is not subject to income tax withholding and social security, Medicare, and FUTA taxes if the meals are furnished for the employer's convenience and on the employer's premises. Income tax preparation seniors The value of lodging is not subject to income tax withholding and social security, Medicare, and FUTA taxes if the lodging is furnished for the employer's convenience, on the employer's premises, and as a condition of employment. Income tax preparation seniors    “For the convenience of the employer” means you have a substantial business reason for providing the meals and lodging other than to provide additional compensation to the employee. Income tax preparation seniors For example, meals you provide at the place of work so that an employee is available for emergencies during his or her lunch period are generally considered to be for your convenience. Income tax preparation seniors   However, whether meals or lodging are provided for the convenience of the employer depends on all of the facts and circumstances. Income tax preparation seniors A written statement that the meals or lodging are for your convenience is not sufficient. Income tax preparation seniors 50% test. Income tax preparation seniors   If over 50% of the employees who are provided meals on an employer's business premises receive these meals for the convenience of the employer, all meals provided on the premises are treated as furnished for the convenience of the employer. Income tax preparation seniors If this 50% test is met, the value of the meals is excludable from income for all employees and is not subject to federal income tax withholding or employment taxes. Income tax preparation seniors For more information, see Publication 15-B. Income tax preparation seniors Health insurance plans. Income tax preparation seniors   If you pay the cost of an accident or health insurance plan for your employees, including an employee's spouse and dependents, your payments are not wages and are not subject to social security, Medicare, and FUTA taxes, or federal income tax withholding. Income tax preparation seniors Generally, this exclusion also applies to qualified long-term care insurance contracts. Income tax preparation seniors However, for income tax withholding, the value of health insurance benefits must be included in the wages of S corporation employees who own more than 2% of the S corporation (2% shareholders). Income tax preparation seniors For social security, Medicare, and FUTA taxes, the health insurance benefits are excluded from the wages only for employees and their dependents or for a class or classes of employees and their dependents. Income tax preparation seniors See Announcement 92-16 for more information. Income tax preparation seniors You can find Announcement 92-16 on page 53 of Internal Revenue Bulletin 1992-5. Income tax preparation seniors Health Savings Accounts and medical savings accounts. Income tax preparation seniors   Your contributions to an employee's Health Savings Account (HSA) or Archer medical savings account (MSA) are not subject to social security, Medicare, or FUTA taxes, or federal income tax withholding if it is reasonable to believe at the time of payment of the contributions they will be excludable from the income of the employee. Income tax preparation seniors To the extent it is not reasonable to believe they will be excludable, your contributions are subject to these taxes. Income tax preparation seniors Employee contributions to their HSAs or MSAs through a payroll deduction plan must be included in wages and are subject to social security, Medicare, and FUTA taxes and income tax withholding. Income tax preparation seniors However, HSA contributions made under a salary reduction arrangement in a section 125 cafeteria plan are not wages and are not subject to employment taxes or withholding. Income tax preparation seniors For more information, see the Instructions for Form 8889, Health Savings Accounts (HSAs). Income tax preparation seniors Medical care reimbursements. Income tax preparation seniors   Generally, medical care reimbursements paid for an employee under an employer's self-insured medical reimbursement plan are not wages and are not subject to social security, Medicare, and FUTA taxes, or income tax withholding. Income tax preparation seniors See Publication 15-B for an exception for highly compensated employees. Income tax preparation seniors Differential wage payments. Income tax preparation seniors   Differential wage payments are any payments made by an employer to an individual for a period during which the individual is performing service in the uniformed services while on active duty for a period of more than 30 days and represent all or a portion of the wages the individual would have received from the employer if the individual were performing services for the employer. Income tax preparation seniors   Differential wage payments are wages for income tax withholding, but are not subject to social security, Medicare, or FUTA taxes. Income tax preparation seniors Employers should report differential wage payments in box 1 of Form W-2. Income tax preparation seniors For more information about the tax treatment of differential wage payments, visit IRS. Income tax preparation seniors gov and enter “employees in a combat zone” in the search box. Income tax preparation seniors Fringe benefits. Income tax preparation seniors   You generally must include fringe benefits in an employee's gross income (but see Nontaxable fringe benefits next). Income tax preparation seniors The benefits are subject to income tax withholding and employment taxes. Income tax preparation seniors Fringe benefits include cars you provide, flights on aircraft you provide, free or discounted commercial flights, vacations, discounts on property or services, memberships in country clubs or other social clubs, and tickets to entertainment or sporting events. Income tax preparation seniors In general, the amount you must include is the amount by which the fair market value of the benefits is more than the sum of what the employee paid for it plus any amount the law excludes. Income tax preparation seniors There are other special rules you and your employees may use to value certain fringe benefits. Income tax preparation seniors See Publication 15-B for more information. Income tax preparation seniors Nontaxable fringe benefits. Income tax preparation seniors   Some fringe benefits are not taxable (or are minimally taxable) if certain conditions are met. Income tax preparation seniors See Publication 15-B for details. Income tax preparation seniors The following are some examples of nontaxable fringe benefits. Income tax preparation seniors Services provided to your employees at no additional cost to you. Income tax preparation seniors Qualified employee discounts. Income tax preparation seniors Working condition fringes that are property or services the employee could deduct as a business expense if he or she had paid for it. Income tax preparation seniors Examples include a company car for business use and subscriptions to business magazines. Income tax preparation seniors Certain minimal value fringes (including an occasional cab ride when an employee must work overtime and meals you provide at eating places you run for your employees if the meals are not furnished at below cost). Income tax preparation seniors Qualified transportation fringes subject to specified conditions and dollar limitations (including transportation in a commuter highway vehicle, any transit pass, and qualified parking). Income tax preparation seniors Qualified moving expense reimbursement. Income tax preparation seniors See Moving expenses , earlier in this section, for details. Income tax preparation seniors The use of on-premises athletic facilities, if substantially all of the use is by employees, their spouses, and their dependent children. Income tax preparation seniors Qualified tuition reduction an educational organization provides to its employees for education. Income tax preparation seniors For more information, see Publication 970, Tax Benefits for Education. Income tax preparation seniors Employer-provided cell phones provided primarily for a noncompensatory business reason. Income tax preparation seniors   However, do not exclude the following fringe benefits from the income of highly compensated employees unless the benefit is available to other employees on a nondiscriminatory basis. Income tax preparation seniors No-additional-cost services. Income tax preparation seniors Qualified employee discounts. Income tax preparation seniors Meals provided at an employer operated eating facility. Income tax preparation seniors Reduced tuition for education. Income tax preparation seniors  For more information, including the definition of a highly compensated employee, see Publication 15-B. Income tax preparation seniors When fringe benefits are treated as paid. Income tax preparation seniors   You may choose to treat certain noncash fringe benefits as paid by the pay period, by the quarter, or on any other basis you choose as long as you treat the benefits as paid at least once a year. Income tax preparation seniors You do not have to make a formal choice of payment dates or notify the IRS of the dates you choose. Income tax preparation seniors You do not have to make this choice for all employees. Income tax preparation seniors You may change methods as often as you like, as long as you treat all benefits provided in a calendar year as paid by December 31 of the calendar year. Income tax preparation seniors See Publication 15-B for more information, including a discussion of the special accounting rule for fringe benefits provided during November and December. Income tax preparation seniors Valuation of fringe benefits. Income tax preparation seniors   Generally, you must determine the value of fringe benefits no later than January 31 of the next year. Income tax preparation seniors Before January 31, you may reasonably estimate the value of the fringe benefits for purposes of withholding and depositing on time. Income tax preparation seniors Withholding on fringe benefits. Income tax preparation seniors   You may add the value of fringe benefits to regular wages for a payroll period and figure withholding taxes on the total, or you may withhold federal income tax on the value of the fringe benefits at the optional flat 25% supplemental wage rate. Income tax preparation seniors However, see Withholding on supplemental wages when an employee receives more than $1 million of supplemental wages during the calendar year in section 7. Income tax preparation seniors   You may choose not to withhold income tax on the value of an employee's personal use of a vehicle you provide. Income tax preparation seniors You must, however, withhold social security and Medicare taxes on the use of the vehicle. Income tax preparation seniors See Publication 15-B for more information on this election. Income tax preparation seniors Depositing taxes on fringe benefits. Income tax preparation seniors   Once you choose when fringe benefits are paid, you must deposit taxes in the same deposit period you treat the fringe benefits as paid. Income tax preparation seniors To avoid a penalty, deposit the taxes following the general deposit rules for that deposit period. Income tax preparation seniors   If you determine by January 31 you overestimated the value of a fringe benefit at the time you withheld and deposited for it, you may claim a refund for the overpayment or have it applied to your next employment tax return. Income tax preparation seniors See Valuation of fringe benefits , earlier. Income tax preparation seniors If you underestimated the value and deposited too little, you may be subject to a failure-to-deposit penalty. Income tax preparation seniors See section 11 for information on deposit penalties. Income tax preparation seniors   If you deposited the required amount of taxes but withheld a lesser amount from the employee, you can recover from the employee the social security, Medicare, or income taxes you deposited on his or her behalf, and included in the employee's Form W-2. Income tax preparation seniors However, you must recover the income taxes before April 1 of the following year. Income tax preparation seniors Sick pay. Income tax preparation seniors   In general, sick pay is any amount you pay under a plan to an employee who is unable to work because of sickness or injury. Income tax preparation seniors These amounts are sometimes paid by a third party, such as an insurance company or an employees' trust. Income tax preparation seniors In either case, these payments are subject to social security, Medicare, and FUTA taxes. Income tax preparation seniors 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. Income tax preparation seniors The payments are always subject to federal income tax. Income tax preparation seniors See Publication 15-A for more information. Income tax preparation seniors 6. Income tax preparation seniors Tips Tips your employee receives from customers are generally subject to withholding. Income tax preparation seniors Your employee must report cash tips to you by the 10th of the month after the month the tips are received. Income tax preparation seniors 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. Income tax preparation seniors Both directly and indirectly tipped employees must report tips to you. Income tax preparation seniors No report is required for months when tips are less than $20. Income tax preparation seniors Your employee reports the tips on Form 4070, Employee's Report of Tips to Employer, or on a similar statement. Income tax preparation seniors 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 the report covers, and The total of tips received during the month or period. Income tax preparation seniors Both Forms 4070 and 4070-A, Employee's Daily Record of Tips, are included in Publication 1244, Employee's Daily Record of Tips and Report to Employer. Income tax preparation seniors You are permitted to establish a system for electronic tip reporting by employees. Income tax preparation seniors See Regulations section 31. Income tax preparation seniors 6053-1(d). Income tax preparation seniors Collecting taxes on tips. Income tax preparation seniors   You must collect income tax, employee social security tax, and employee Medicare tax on the employee's tips. Income tax preparation seniors 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. Income tax preparation seniors If an employee reports to you in writing $20 or more of tips in a month, the tips are also subject to FUTA tax. Income tax preparation seniors   You can collect these taxes from the employee's wages or from other funds he or she makes available. Income tax preparation seniors See Tips treated as supplemental wages in section 7 for more information. Income tax preparation seniors Stop collecting the employee social security tax when his or her wages and tips for tax year 2014 reach $117,000; collect the income and employee Medicare taxes for the whole year on all wages and tips. Income tax preparation seniors You are responsible for the employer social security tax on wages and tips until the wages (including tips) reach the limit. Income tax preparation seniors You are responsible for the employer Medicare tax for the whole year on all wages and tips. Income tax preparation seniors File Form 941 or Form 944 to report withholding and employment taxes on tips. Income tax preparation seniors Ordering rule. Income tax preparation seniors   If, by the 10th of the month after the month for which you received an employee's report on tips, you do not have enough employee funds available to deduct the employee tax, you no longer have to collect it. Income tax preparation seniors If there are not enough funds available, withhold taxes in the following order. Income tax preparation seniors Withhold on regular wages and other compensation. Income tax preparation seniors Withhold social security and Medicare taxes on tips. Income tax preparation seniors Withhold income tax on tips. Income tax preparation seniors Reporting tips. Income tax preparation seniors   Report tips and any collected and uncollected social security and Medicare taxes on Form W-2 and on Form 941, lines 5b, 5c, and 5d (Form 944, lines 4b, 4c, and 4d). Income tax preparation seniors Report an adjustment on Form 941, line 9 (Form 944, line 6), for the uncollected social security and Medicare taxes. Income tax preparation seniors Enter the amount of uncollected social security tax and Medicare tax on Form W-2, box 12, with codes “A” and “B. Income tax preparation seniors ” Do not include any uncollected Additional Medicare Tax in box 12 of Form W-2. Income tax preparation seniors See section 13 and the General Instructions for Forms W-2 and W-3. Income tax preparation seniors   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. Income tax preparation seniors See Revenue Ruling 2012-18, 2012-26 I. Income tax preparation seniors R. Income tax preparation seniors B. Income tax preparation seniors 1032, available at www. Income tax preparation seniors irs. Income tax preparation seniors gov/irb/2012-26_IRB/ar07. Income tax preparation seniors html. Income tax preparation seniors Allocated tips. Income tax preparation seniors   If you operate a large food or beverage establishment, you must report allocated tips under certain circumstances. Income tax preparation seniors However, do not withhold income, social security, or Medicare taxes on allocated tips. Income tax preparation seniors   A large food or beverage establishment is one that provides food or beverages for consumption on the premises, where tipping is customary, and where there were normally more than 10 employees on a typical business day during the preceding year. Income tax preparation seniors   The tips may be allocated by one of three methods—hours worked, gross receipts, or good faith agreement. Income tax preparation seniors For information about these allocation methods, including the requirement to file Forms 8027 electronically if 250 or more forms are filed, see the Instructions for Form 8027. Income tax preparation seniors For information on filing Form 8027 electronically with the IRS, see Publication 1239. Income tax preparation seniors Tip Rate Determination and Education Program. Income tax preparation seniors   Employers may participate in the Tip Rate Determination and Education Program. Income tax preparation seniors The program primarily consists of two voluntary agreements developed to improve tip income reporting by helping taxpayers to understand and meet their tip reporting responsibilities. Income tax preparation seniors The two agreements are the Tip Rate Determination Agreement (TRDA) and the Tip Reporting Alternative Commitment (TRAC). Income tax preparation seniors A tip agreement, the Gaming Industry Tip Compliance Agreement (GITCA), is available for the gaming (casino) industry. Income tax preparation seniors To get more information about TRDA and TRAC agreements, see Publication 3144, Tips on Tips. Income tax preparation seniors Additionally, visit IRS. Income tax preparation seniors gov and enter “MSU tips” in the search box to get more information about GITCA, TRDA, or TRAC agreements. Income tax preparation seniors 7. Income tax preparation seniors Supplemental Wages Supplemental wages are wage payments to an employee that are not regular wages. Income tax preparation seniors They include, but are not limited to, bonuses, commissions, overtime pay, payments for accumulated sick leave, severance pay, awards, prizes, back pay, retroactive pay increases, and payments for nondeductible moving expenses. Income tax preparation seniors Other payments subject to the supplemental wage rules include taxable fringe benefits and expense allowances paid under a nonaccountable plan. Income tax preparation seniors How you withhold on supplemental wages depends on whether the supplemental payment is identified as a separate payment from regular wages. Income tax preparation seniors See Regulations section 31. Income tax preparation seniors 3402(g)-1 for additional guidance for wages paid after January 1, 2007. Income tax preparation seniors Also see Revenue Ruling 2008-29, 2008-24 I. Income tax preparation seniors R. Income tax preparation seniors B. Income tax preparation seniors 1149, available at www. Income tax preparation seniors irs. Income tax preparation seniors gov/irb/2008-24_IRB/ar08. Income tax preparation seniors html. Income tax preparation seniors Withholding on supplemental wages when an employee receives more than $1 million of supplemental wages from you during the calendar year. Income tax preparation seniors   Special rules apply to the extent supplemental wages paid to any one employee during the calendar year exceed $1 million. Income tax preparation seniors If a supplemental wage payment, together with other supplemental wage payments made to the employee during the calendar year, exceeds $1 million, the excess is subject to withholding at 39. Income tax preparation seniors 6% (or the highest rate of income tax for the year). Income tax preparation seniors Withhold using the 39. Income tax preparation seniors 6% rate without regard to the employee's Form W-4. Income tax preparation seniors In determining supplemental wages paid to the employee during the year, include payments from all businesses under common control. Income tax preparation seniors For more information, see Treasury Decision 9276, 2006-37 I. Income tax preparation seniors R. Income tax preparation seniors B. Income tax preparation seniors 423, available at www. Income tax preparation seniors irs. Income tax preparation seniors gov/irb/2006-37_IRB/ar09. Income tax preparation seniors html. Income tax preparation seniors Withholding on supplemental wage payments to an employee who does not receive $1 million of supplemental wages during the calendar year. Income tax preparation seniors   If the supplemental wages paid to the employee during the calendar year are less than or equal to $1 million, the following rules apply in determining the amount of income tax to be withheld. Income tax preparation seniors Supplemental wages combined with regular wages. Income tax preparation seniors   If you pay supplemental wages with regular wages but do not specify the amount of each, withhold federal income tax as if the total were a single payment for a regular payroll period. Income tax preparation seniors Supplemental wages identified separately from regular wages. Income tax preparation seniors   If you pay supplemental wages separately (or combine them in a single payment and specify the amount of each), the federal income tax withholding method depends partly on whether you withhold income tax from your employee's regular wages. Income tax preparation seniors If you withheld income tax from an employee's regular wages in the current or immediately preceding calendar year, you can use one of the following methods for the supplemental wages. Income tax preparation seniors Withhold a flat 25% (no other percentage allowed). Income tax preparation seniors If the supplemental wages are paid concurrently with regular wages, add the supplemental wages to the concurrently paid regular wages. Income tax preparation seniors If there are no concurrently paid regular wages, add the supplemental wages to alternatively, either the regular wages paid or to be paid for the current payroll period or the regular wages paid for the preceding payroll period. Income tax preparation seniors Figure the income tax withholding as if the total of the regular wages and supplemental wages is a single payment. Income tax preparation seniors Subtract the tax withheld from the regular wages. Income tax preparation seniors Withhold the remaining tax from the supplemental wages. Income tax preparation seniors If there were other payments of supplemental wages paid during the payroll period made before the current payment of supplemental wages, aggregate all the payments of supplemental wages paid during the payroll period with the regular wages paid during the payroll period, calculate the tax on the total, subtract the tax already withheld from the regular wages and the previous supplemental wage payments, and withhold the remaining tax. Income tax preparation seniors If you did not withhold income tax from the employee's regular wages in the current or immediately preceding calendar year, use method 1-b. Income tax preparation seniors This would occur, for example, when the value of the employee's withholding allowances claimed on Form W-4 is more than the wages. Income tax preparation seniors Regardless of the method you use to withhold income tax on supplemental wages, they are subject to social security, Medicare, and FUTA taxes. Income tax preparation seniors Example 1. Income tax preparation seniors You pay John Peters a base salary on the 1st of each month. Income tax preparation seniors He is single and claims one withholding allowance. Income tax preparation seniors In January he is paid $1,000. Income tax preparation seniors Using the wage bracket tables, you withhold $50 from this amount. Income tax preparation seniors In February, he receives salary of $1,000 plus a commission of $2,000, which you combine with regular wages and do not separately identify. Income tax preparation seniors You figure the withholding based on the total of $3,000. Income tax preparation seniors The correct withholding from the tables is $338. Income tax preparation seniors Example 2. Income tax preparation seniors You pay Sharon Warren a base salary on the 1st of each month. Income tax preparation seniors She is single and claims one allowance. Income tax preparation seniors Her May 1 pay is $2,000. Income tax preparation seniors Using the wage bracket tables, you withhold $188. Income tax preparation seniors On May 14 she receives a bonus of $1,000. Income tax preparation seniors Electing to use supplemental wage withholding method 1-b, you: Add the bonus amount to the amount of wages from the most recent base salary pay date (May 1) ($2,000 + $1,000 = $3,000). Income tax preparation seniors Determine the amount of withholding on the combined $3,000 amount to be $338 using the wage bracket tables. Income tax preparation seniors Subtract the amount withheld from wages on the most recent base salary pay date (May 1) from the combined withholding amount ($338 – $188 = $150). Income tax preparation seniors Withhold $150 from the bonus payment. Income tax preparation seniors Example 3. Income tax preparation seniors The facts are the same as in Example 2, except you elect to use the flat rate method of withholding on the bonus. Income tax preparation seniors You withhold 25% of $1,000, or $250, from Sharon's bonus payment. Income tax preparation seniors Example 4. Income tax preparation seniors The facts are the same as in Example 2, except you elect to pay Sharon a second bonus of $2,000 on May 28. Income tax preparation seniors Using supplemental wage withholding method 1-b, you: Add the first and second bonus amounts to the amount of wages from the most recent base salary pay date (May 1) ($2,000 + $1,000 + $2,000 = $5,000). Income tax preparation seniors Determine the amount of withholding on the combined $5,000 amount to be $781 using the wage bracket tables. Income tax preparation seniors Subtract the amounts withheld from wages on the most recent base salary pay date (May 1) and the amounts withheld from the first bonus payment from the combined withholding amount ($781 – $188 – $150 = $443). Income tax preparation seniors Withhold $443 from the second bonus payment. Income tax preparation seniors Tips treated as supplemental wages. Income tax preparation seniors   Withhold income tax on tips from wages earned by the employee or from other funds the employee makes available. Income tax preparation seniors If an employee receives regular wages and reports tips, figure income tax withholding as if the tips were supplemental wages. Income tax preparation seniors If you have not withheld income tax from the regular wages, add the tips to the regular wages. Income tax preparation seniors Then withhold income tax on the total. Income tax preparation seniors If you withheld income tax from the regular wages, you can withhold on the tips by method 1-a or 1-b discussed earlier in this section under Supplemental wages identified separately from regular wages. Income tax preparation seniors Vacation pay. Income tax preparation seniors   Vacation pay is subject to withholding as if it were a regular wage payment. Income tax preparation seniors When vacation pay is in addition to regular wages for the vacation period, treat it as a supplemental wage payment. Income tax preparation seniors If the vacation pay is for a time longer than your usual payroll period, spread it over the pay periods for which you pay it. Income tax preparation seniors 8. Income tax preparation seniors Payroll Period Your payroll period is a period of service for which you usually pay wages. Income tax preparation seniors When you have a regular payroll period, withhold income tax for that time period even if your employee does not work the full period. Income tax preparation seniors No regular payroll period. Income tax preparation seniors   When you do not have a regular payroll period, withhold the tax as if you paid wages for a daily or miscellaneous payroll period. Income tax preparation seniors Figure the number of days (including Sundays and holidays) in the period covered by the wage payment. Income tax preparation seniors If the wages are unrelated to a specific length of time (for example, commissions paid on completion of a sale), count back the number of days from the payment period to the latest of: The last wage payment made during the same calendar year, The date employment began, if during the same calendar year, or January 1 of the same year. Income tax preparation seniors Employee paid for period less than 1 week. Income tax preparation seniors   When you pay an employee for a period of less than one week, and the employee signs a statement under penalties of perjury indicating he or she is not working for any other employer during the same week for wages subject to withholding, figure withholding based on a weekly payroll period. Income tax preparation seniors If the employee later begins to work for another employer for wages subject to withholding, the employee must notify you within 10 days. Income tax preparation seniors You then figure withholding based on the daily or miscellaneous period. Income tax preparation seniors 9. Income tax preparation seniors Withholding From Employees' Wages Income Tax Withholding Using Form W-4 to figure withholding. Income tax preparation seniors   To know how much federal income tax to withhold from employees' wages, you should have a Form W-4 on file for each employee. Income tax preparation seniors Encourage your employees to file an updated Form W-4 for 2014, especially if they owed taxes or received a large refund when filing their 2013 tax return. Income tax preparation seniors Advise your employees to use the IRS Withholding Calculator on the IRS website at www. Income tax preparation seniors irs. Income tax preparation seniors gov/individuals for help in determining how many withholding allowances to claim on their Forms W-4. Income tax preparation seniors   Ask all new employees to give you a signed Form W-4 when they start work. Income tax preparation seniors Make the form effective with the first wage payment. Income tax preparation seniors If a new employee does not give you a completed Form W-4, withhold income tax as if he or she is single, with no withholding allowances. Income tax preparation seniors Form in Spanish. Income tax preparation seniors   You can provide Formulario W-4(SP), Certificado de Exención de Retenciones del Empleado, in place of Form W-4, to your Spanish-speaking employees. Income tax preparation seniors For more information, see Publicación 17(SP), El Impuesto Federal sobre los Ingresos (Para Personas Físicas). Income tax preparation seniors The rules discussed in this section that apply to Form W-4 also apply to Formulario W-4(SP). Income tax preparation seniors Electronic system to receive Form W-4. Income tax preparation seniors   You may establish a system to electronically receive Forms W-4 from your employees. Income tax preparation seniors See Regulations section 31. Income tax preparation seniors 3402(f)(5)-1(c) for more information. Income tax preparation seniors Effective date of Form W-4. Income tax preparation seniors   A Form W-4 remains in effect until the employee gives you a new one. Income tax preparation seniors When you receive a new Form W-4 from an employee, do not adjust withholding for pay periods before the effective date of the new form. Income tax preparation seniors If an employee gives you a Form W-4 that replaces an existing Form W-4, begin withholding no later than the start of the first payroll period ending on or after the 30th day from the date when you received the replacement Form W-4. Income tax preparation seniors For exceptions, see Exemption from federal income tax withholding , IRS review of requested Forms W-4 , and Invalid Forms W-4 , later in this section. Income tax preparation seniors A Form W-4 that makes a change for the next calendar year will not take effect in the current calendar year. Income tax preparation seniors Successor employer. Income tax preparation seniors   If you are a successor employer (see Successor employer , later in this section), secure new Forms W-4 from the transferred employees unless the “Alternative Procedure” in section 5 of Revenue Procedure 2004-53 applies. Income tax preparation seniors See Revenue Procedure 2004-53, 2004-34 I. Income tax preparation seniors R. Income tax preparation seniors B. Income tax preparation seniors 320, available at www. Income tax preparation seniors irs. Income tax preparation seniors gov/irb/2004-34_IRB/ar13. Income tax preparation seniors html. Income tax preparation seniors Completing Form W-4. Income tax preparation seniors   The amount of any federal income tax withholding must be based on marital status and withholding allowances. Income tax preparation seniors Your employees may not base their withholding amounts on a fixed dollar amount or percentage. Income tax preparation seniors However, an employee may specify a dollar amount to be withheld in addition to the amount of withholding based on filing status and withholding allowances claimed on Form W-4. Income tax preparation seniors Employees may claim fewer withholding allowances than they are entitled to claim. Income tax preparation seniors They may wish to claim fewer allowances to ensure they have enough withholding or to offset the tax on other sources of taxable income not subject to withholding. Income tax preparation seniors See Publication 505, Tax Withholding and Estimated Tax, for more information about completing Form W-4. Income tax preparation seniors Along with Form W-4, you may wish to order Publication 505 for use by your employees. Income tax preparation seniors Do not accept any withholding or estimated tax payments from your employees in addition to withholding based on their Form W-4. Income tax preparation seniors If they require additional withholding, they should submit a new Form W-4 and, if necessary, pay estimated tax by filing Form 1040-ES, Estimated Tax for Individuals, or by using the Electronic Federal Tax Payment System (EFTPS) to make estimated tax payments. Income tax preparation seniors Exemption from federal income tax withholding. Income tax preparation seniors   Generally, an employee may claim exemption from federal income tax withholding because he or she had no income tax liability last year and expects none this year. Income tax preparation seniors See the Form W-4 instructions for more information. Income tax preparation seniors However, the wages are still subject to social security and Medicare taxes. Income tax preparation seniors See also Invalid Forms W-4 , later in this section. Income tax preparation seniors   A Form W-4 claiming exemption from withholding is effective when it is filed with the employer and only for that calendar year. Income tax preparation seniors To continue to be exempt from withholding in the next calendar year, an employee must give you a new Form W-4 by February 15. Income tax preparation seniors If the employee does not give you a new Form W-4 by February 15, begin withholding based on the last Form W-4 for the employee that did not claim an exemption from withholding or, if one was not filed, then withhold tax as if he or she is single with zero withholding allowances. Income tax preparation seniors If the employee provides a new Form W-4 claiming exemption from withholding on February 16 or later, you may apply it to future wages but do not refund any taxes already withheld. Income tax preparation seniors Withholding income taxes on the wages of nonresident alien employees. Income tax preparation seniors   In general, you must withhold federal income taxes on the wages of nonresident alien employees. Income tax preparation seniors However, see Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities, for exceptions to this general rule. Income tax preparation seniors Also see section 3 of Publication 51 (Circular A), Agricultural Employer's Tax Guide, for guidance on H-2A visa workers. Income tax preparation seniors Withholding adjustment for nonresident alien employees. Income tax preparation seniors   For 2014, apply the procedure discussed next to figure the amount of income tax to withhold from the wages of nonresident alien employees performing services within the United States. Income tax preparation seniors Nonresident alien students from India and business apprentices from India are not subject to this procedure. Income tax preparation seniors Instructions. Income tax preparation seniors   To figure how much income tax to withhold from the wages paid to a nonresident alien employee performing services in the United States, use the following steps. Income tax preparation seniors Step 1. Income tax preparation seniors   Add to the wages paid to the nonresident alien employee for the payroll period the amount shown in the chart below for the applicable payroll period. Income tax preparation seniors    Amount to Add to Nonresident Alien Employee's Wages for Calculating Income Tax Withholding Only   Payroll Period Add Additional     Weekly $ 43. Income tax preparation seniors 30     Biweekly 86. Income tax preparation seniors 50     Semimonthly 93. Income tax preparation seniors 80     Monthly 187. Income tax preparation seniors 50     Quarterly 562. Income tax preparation seniors 50     Semiannually 1,125. Income tax preparation seniors 00     Annually 2,250. Income tax preparation seniors 00     Daily or Miscellaneous (each day of the payroll period) 8. Income tax preparation seniors 70   Step 2. Income tax preparation seniors   Use the amount figured in Step 1 and the number of withholding allowances claimed (generally limited to one allowance) to figure income tax withholding. Income tax preparation seniors Determine the value of withholding allowances by multiplying the number of withholding allowances claimed by the appropriate amount from Table 5. Income tax preparation seniors Percentage Method—2014 Amount for One Withholding Allowance shown on page 41. Income tax preparation seniors If you are using the Percentage Method Tables for Income Tax Withholding, provided on pages 43–44, reduce the amount figured in Step 1 by the value of withholding allowances and use that reduced amount to figure the income tax withholding. Income tax preparation seniors If you are using the Wage Bracket Method for Income Tax Withholding, provided on pages 45–64, use the amount figured in Step 1 and the number of withholding allowances to figure income tax withholding. Income tax preparation seniors The amounts from the chart above are added to wages solely for calculating income tax withholding on the wages of the nonresident alien employee. Income tax preparation seniors The amounts from the chart should not be included in any box on the employee's Form W-2 and do not increase the income tax liability of the employee. Income tax preparation seniors Also, the amounts from the chart do not increase the social security tax or Medicare tax liability of the employer or the employee, or the FUTA tax liability of the employer. Income tax preparation seniors This procedure only applies to nonresident alien employees who have wages subject to income tax withholding. Income tax preparation seniors Example. Income tax preparation seniors An employer using the percentage method of withholding pays wages of $500 for a biweekly payroll period to a married nonresident alien employee. Income tax preparation seniors The nonresident alien has properly completed Form W-4, entering marital status as “single” with one withholding allowance and indicating status as a nonresident alien on Form W-4, line 6 (see Nonresident alien employee's Form W-4 , later in this section). Income tax preparation seniors The employer determines the wages to be used in the withholding tables by adding to the $500 amount of wages paid the amount of $86. Income tax preparation seniors 50 from the chart under Step 1 ($586. Income tax preparation seniors 50 total). Income tax preparation seniors The employer then applies the applicable tables to determine the income tax withholding for nonresident aliens (see Step 2 ). Income tax preparation seniors Reminder: If you use the Percentage Method Tables for Income Tax Withholding, reduce the amount figured in Step 1 by the value of withholding allowances and use that reduced amount to figure income tax withholding. Income tax preparation seniors The $86. Income tax preparation seniors 50 added to wages for calculating income tax withholding is not reported on Form W-2, and does not increase the income tax liability of the employee. Income tax preparation seniors Also, the $86. Income tax preparation seniors 50 added to wages does not affect the social security tax or Medicare tax liability of the employer or the employee, or the FUTA tax liability of the employer. Income tax preparation seniors Supplemental wage payment. Income tax preparation seniors   This procedure for determining the amount of income tax withholding does not apply to a supplemental wage payment (see section 7) if the 39. Income tax preparation seniors 6% mandatory flat rate withholding applies or if the 25% optional flat rate withholding is being used to calculate income tax withholding on the supplemental wage payment. Income tax preparation seniors Nonresident alien employee's Form W-4. Income tax preparation seniors   When completing Forms W-4, nonresident aliens are required to: Not claim exemption from income tax withholding, Request withholding as if they are single, regardless of their actual marital status, Claim only one allowance (if the nonresident alien is a resident of Canada, Mexico, or South Korea, or a student or business apprentice from India, he or she may claim more than one allowance), and Write “Nonresident Alien” or “NRA” above the dotted line on line 6 of Form W-4. Income tax preparation seniors   If you maintain an electronic Form W-4 system, you should provide a field for nonresident aliens to enter nonresident alien status in lieu of writing “Nonresident Alien” or “NRA” above the dotted line on line 6. Income tax preparation seniors A nonresident alien employee may request additional withholding at his or her option for other purposes, although such additions should not be necessary for withholding to cover federal income tax liability related to employment. Income tax preparation seniors Form 8233. Income tax preparation seniors   If a nonresident alien employee claims a tax treaty exemption from withholding, the employee must submit Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, with respect to the income exempt under the treaty, instead of Form W-4. Income tax preparation seniors See Publication 515 for details. Income tax preparation seniors IRS review of requested Forms W-4. Income tax preparation seniors   When requested by the IRS, you must make original Forms W-4 available for inspection by an IRS employee. Income tax preparation seniors You may also be directed to send certain Forms W-4 to the IRS. Income tax preparation seniors You may receive a notice from the IRS requiring you to submit a copy of Form W-4 for one or more of your named employees. Income tax preparation seniors Send the requested copy or copies of Form W-4 to the IRS at the address provided and in the manner directed by the notice. Income tax preparation seniors The IRS may also require you to submit copies of Form W-4 to the IRS as directed by Treasury Decision 9337, 2007-35 I. Income tax preparation seniors R. Income tax preparation seniors B. Income tax preparation seniors 455, which is available at www. Income tax preparation seniors irs. Income tax preparation seniors gov/irb/2007-35_IRB/ar10. Income tax preparation seniors html. Income tax preparation seniors When we refer to Form W-4, the same rules apply to Formulario W-4(SP), its Spanish translation. Income tax preparation seniors After submitting a copy of a requested Form W-4 to the IRS, continue to withhold federal income tax based on that Form W-4 if it is valid (see Invalid Forms W-4 , later in this section). Income tax preparation seniors However, if the IRS later notifies you in writing the employee is not entitled to claim exemption from withholding or a claimed number of withholding allowances, withhold federal income tax based on the effective date, marital status, and maximum number of withholding allowances specified in the IRS notice (commonly referred to as a "lock-in letter