Publication 225 |
2000 Tax Year |
Reporting & Paying Social Security, Medicare, and Withheld Income Taxes
You must withhold income, social security, and Medicare taxes
required to be withheld from the salaries and wages of your employees.
You are liable for the payment of these taxes to the federal
government whether or not you collect them from your employees. If,
for example, you withhold less than the correct tax from an employee's
wages, you are still liable for the full amount. You must also pay the
employer's share of social security and Medicare taxes.
Form 943.
Report withheld income tax and social security and Medicare taxes
on Form 943. The 2000 form is due by January 31, 2001 (or February 12
if the taxes were timely deposited in full).
Deposits.
You will generally have to make periodic tax deposits if you are
liable for $2,500 or more of social security and Medicare taxes and
withheld income tax during the year.
Electronic Federal Tax Payment System (EFTPS).
You may have to deposit taxes using EFTPS. You must use EFTPS to
make deposits of all depository tax liabilities (including social
security, Medicare, withheld income, excise, and corporate income
taxes) you incur in 2001 if you deposited more than $200,000 in
federal depository taxes in 1999. If you first meet the $200,000
threshold in 2000, you must begin depositing using EFTPS in 2002. Once
you meet the $200,000 threshold, you must continue to make deposits
using EFTPS in later years even if subsequent deposits are less than
the $200,000 threshold.
If you must use EFTPS but fail to do so, you may be subject to a
10% penalty.
If you are not required to use EFTPS because you did not meet the
$200,000 threshold during 1998, or during any subsequent year, then
you may voluntarily make your deposits using EFTPS. However, if you
are using EFTPS voluntarily, you will not be subject to the 10%
penalty if you make a deposit using a paper coupon.
For information about EFTPS, access the IRS web site on the
Internet at www.irs.gov, or see Publication 966, The
Easiest Way to Pay Your Federal Taxes.
To enroll in EFTPS, call:
- 1-800-945-8400, or
- 1-800-555-4477.
More information.
For more information on deposit rules, see Circular A.
Form W-2.
By January 31, you must furnish each employee a Form W-2
showing total wages for the previous year and total income tax and
social security and Medicare taxes withheld. However, if an employee
stops working for you and requests the form earlier, you must give it
to the employee within 30 days of the later of the
following dates.
- The date the employee requests the form.
- The date you make your final payment of wages to the
employee.
See Form W-2 under Information Returns
in chapter 2.
Trust fund recovery penalty.
If you are responsible for withholding, accounting for, depositing,
or paying withholding taxes and willfully fail to do so,
you can be held liable for a penalty equal to the tax not paid, plus
interest. A responsible person can be an officer of a corporation, a
partner, a sole proprietor, or an employee of any form of business. A
trustee or agent with authority over the funds of the business can
also be held responsible for the penalty.
"Willfully" in this case means voluntarily, consciously, and
intentionally. Paying other expenses of the business instead of the
taxes due is considered to be acting willfully.
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