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Penalty For Filing Taxes Late

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Penalty For Filing Taxes Late

Penalty for filing taxes late Publication 505 - Introductory Material Table of Contents IntroductionNonresident aliens. Penalty for filing taxes late Ordering forms and publications. Penalty for filing taxes late Tax questions. Penalty for filing taxes late What's New for 2014 Reminders Introduction The federal income tax is a pay-as-you-go tax. Penalty for filing taxes late You must pay the tax as you earn or receive income during the year. Penalty for filing taxes late There are two ways to pay as you go. Penalty for filing taxes late Withholding. Penalty for filing taxes late If you are an employee, your employer probably withholds income tax from your pay. Penalty for filing taxes late In addition, tax may be withheld from certain other income, such as pensions, bonuses, commissions, and gambling winnings. Penalty for filing taxes late The amount withheld is paid to the Internal Revenue Service (IRS) in your name. Penalty for filing taxes late Estimated tax. Penalty for filing taxes late If you do not pay your tax through withholding, or do not pay enough tax that way, you might have to pay estimated tax. Penalty for filing taxes late People who are in business for themselves generally will have to pay their tax this way. Penalty for filing taxes late You may have to pay estimated tax if you receive income such as dividends, interest, capital gains, rents, and royalties. Penalty for filing taxes late Estimated tax is used to pay not only income tax, but other taxes such as self-employment tax and alternative minimum tax. Penalty for filing taxes late This publication explains both of these methods. Penalty for filing taxes late It also explains how to take credit on your return for the tax that was withheld and for your estimated tax payments. Penalty for filing taxes late If you did not pay enough tax during the year, either through withholding or by making estimated tax payments, you may have to pay a penalty. Penalty for filing taxes late Generally, the IRS can figure this penalty for you. Penalty for filing taxes late This underpayment penalty, and the exceptions to it, are discussed in chapter 4. Penalty for filing taxes late Nonresident aliens. Penalty for filing taxes late    Before completing Form W-4, nonresident alien employees should see the Instructions for Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual. Penalty for filing taxes late Also see chapter 8 of Publication 519, U. Penalty for filing taxes late S. Penalty for filing taxes late Tax Guide for Aliens, for important information on withholding. Penalty for filing taxes late What's new for 2013 and 2014. Penalty for filing taxes late   See What's New for 2014 in this Introduction, and What's New for 2013 in chapter 4. Penalty for filing taxes late Comments and suggestions. Penalty for filing taxes late   We welcome your comments about this publication and your suggestions for future editions. Penalty for filing taxes late   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Penalty for filing taxes late NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Penalty for filing taxes late Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Penalty for filing taxes late   You can send your comments from www. Penalty for filing taxes late irs. Penalty for filing taxes late gov/formspubs/. Penalty for filing taxes late Click on “More Information” and then on Give us feedback on forms and publications. Penalty for filing taxes late   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. Penalty for filing taxes late Ordering forms and publications. Penalty for filing taxes late   Visit www. Penalty for filing taxes late irs. Penalty for filing taxes late 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 business days after your request is received. Penalty for filing taxes late Internal Revenue Service 1201 N. Penalty for filing taxes late Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Penalty for filing taxes late   If you have a tax question, check the information available on IRS. Penalty for filing taxes late gov or call 1-800-829-1040. Penalty for filing taxes late We cannot answer tax questions sent to either of the above addresses. Penalty for filing taxes late What's New for 2014 Use your 2013 tax return as a guide in figuring your 2014 estimated tax, but be sure to consider the following. Penalty for filing taxes late Standard mileage rates. Penalty for filing taxes late  The 2014 rate for business use of your vehicle is 56 cents per mile. Penalty for filing taxes late The rate for use of your vehicle to get medical care or move is 23½ cents per mile. Penalty for filing taxes late The rate of 14 cents per mile for charitable use is unchanged. Penalty for filing taxes late Personal exemption increased for certain taxpayers. Penalty for filing taxes late  For 2014, the personal exemption amount is increased to $3,950 for taxpayers with adjusted gross income at or below $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately. Penalty for filing taxes late The personal exemption amount for taxpayers with adjusted gross income above these thresholds may be reduced. Penalty for filing taxes late Limitation on itemized deductions. Penalty for filing taxes late  For 2014, itemized deductions for taxpayers with adjusted gross income above $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, and $152,525 if married filing separately may be reduced. Penalty for filing taxes late Health care coverage. Penalty for filing taxes late  When you file your 2014 tax return in 2015, you will need to either (1) indicate on your return that you and your family had health care coverage throughout 2014, (2) claim an exemption from the health care coverage requirement for some or all of 2014, or (3) make a payment if you do not have coverage or an exemption(s) for all 12 months of 2014. Penalty for filing taxes late For examples on how this payment works, go to www. Penalty for filing taxes late IRS. Penalty for filing taxes late gov/aca and click under the “Individuals & Families” section. Penalty for filing taxes late You may want to consider this when figuring your “Other taxes” on Line 12 of the 2014 Estimated Tax Worksheet (Worksheet 2-1). Penalty for filing taxes late For general information on these requirements, go to www. Penalty for filing taxes late IRS. Penalty for filing taxes late gov/aca. Penalty for filing taxes late Advance payments of the Premium Tax Credit. Penalty for filing taxes late  If you buy health care insurance through the Health Insurance Marketplace, you may be eligible for advance payments of the Premium Tax Credit to help pay for your insurance coverage. Penalty for filing taxes late Receiving too little or too much in advance will affect your refund or balance due. Penalty for filing taxes late Promptly report changes in your income or family size to your Marketplace. Penalty for filing taxes late You may want to consider this when figuring your estimated taxes for 2014. Penalty for filing taxes late For more information, go to www. Penalty for filing taxes late IRS. Penalty for filing taxes late gov/aca and see Publication 5120 and Publication 5121. Penalty for filing taxes late http://www. Penalty for filing taxes late IRS. Penalty for filing taxes late gov/pub5120 Alternative minimum tax (AMT) exemption amount increased. Penalty for filing taxes late  The AMT exemption amount is increased to $52,800 ($82,100 if married filing jointly or qualifying widow(er); $41,050 if married filing separately). Penalty for filing taxes late Lifetime learning credit income limits. Penalty for filing taxes late  In order to claim a lifetime learning credit, your MAGI must be less than $54,000 ($108,000 if married filing jointly). Penalty for filing taxes late Retirement savings contribution credit income limits increased. Penalty for filing taxes late  In order to claim this credit for 2014, your MAGI must be less than $30,000 ($60,000 if married filing jointly; $45,000 if head of household). Penalty for filing taxes late Adoption credit or exclusion. Penalty for filing taxes late  The maximum adoption credit or exclusion for employer-provided adoption benefits has increased to $13,190. Penalty for filing taxes late In order to claim either the credit or exclusion, your MAGI must be less than $237,880. Penalty for filing taxes late Earned income credit (EIC). Penalty for filing taxes late  You may be able to take the EIC in 2014 if: Three or more children lived with you and you earned less than $46,997 ($52,427 if married filing jointly), Two children lived with you and you earned less than $43,756 ($49,186 if married filing jointly), One child lived with you and you earned less than $38,511 ($43,941 if married filing jointly), or A child did not live with you and you earned less than $14,590 ($20,020 if married filing jointly). Penalty for filing taxes late Also, the maximum MAGI you can have and still get the credit has increased. Penalty for filing taxes late You may be able to take the credit if your MAGI is less than the amount in the above list that applies to you. Penalty for filing taxes late The maximum investment income you can have and get the credit has increased to $3,350. Penalty for filing taxes late Reminders Future developments. Penalty for filing taxes late  The IRS has created a page on IRS. Penalty for filing taxes late gov for information about Publication 505 at www. Penalty for filing taxes late irs. Penalty for filing taxes late gov/pub505. Penalty for filing taxes late Information about any future developments affecting Publication 505 (such as legislation enacted after we release it) will be posted on that page. Penalty for filing taxes late Social security tax. Penalty for filing taxes late   Generally, each employer for whom you work during the tax year must withhold social security tax up to the annual limit. Penalty for filing taxes late The annual limit is $117,000 in 2014. Penalty for filing taxes late Photographs of missing children. Penalty for filing taxes late  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Penalty for filing taxes late Photographs of missing children selected by the Center may appear in this publication on pages that otherwise would be blank. Penalty for filing taxes late 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. Penalty for filing taxes late Additional Medicare Tax. Penalty for filing taxes late  Beginning in 2013, a 0. Penalty for filing taxes late 9% Additional Medicare Tax applies to Medicare wages, Railroad Retirement Tax Act compensation, and self-employment income over a threshold amount based on your filing status. Penalty for filing taxes late You may need to include this amount when figuring your estimated tax. Penalty for filing taxes late See the instructions for line 12 of the 2014 Estimated Tax Worksheet. Penalty for filing taxes late You may also request that your employer deduct and withhold an additional amount of income tax withholding from your wages on Form W-4, Employee's Withholding Allowance Certificate. Penalty for filing taxes late For more information on Additional Medicare Tax, go to IRS. Penalty for filing taxes late gov and enter “Additional Medicare Tax” in the search box. Penalty for filing taxes late Net Investment Income Tax. Penalty for filing taxes late  Beginning in 2013, you may be subject to Net Investment Income Tax (NIIT). Penalty for filing taxes late NIIT is a 3. Penalty for filing taxes late 8% tax on the lesser of net investment income or the excess of your modified adjusted gross income (MAGI) over the threshold amount. Penalty for filing taxes late NIIT may need to be included when figuring estimated tax. Penalty for filing taxes late See the instructions for line 12 of the 2014 Estimated Tax Worksheet. Penalty for filing taxes late You may also request that your employer deduct and withhold an additional amount of income tax withholding from your wages on Form W-4. Penalty for filing taxes late For more information on NIIT, go to IRS. Penalty for filing taxes late gov and enter “Net Investment Income Tax” in the search box. 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Page Last Reviewed or Updated: 06-Mar-2014

The Penalty For Filing Taxes Late

Penalty for filing taxes late Publication 51 - Main Content Table of Contents 1. Penalty for filing taxes late Taxpayer Identification NumbersWhen you receive your EIN. Penalty for filing taxes late Registering for SSNVS. Penalty for filing taxes late 2. Penalty for filing taxes late Who Are Employees?Crew Leaders Business Owned and Operated by Spouses 3. Penalty for filing taxes late Wages and Other Compensation 4. Penalty for filing taxes late Social Security and Medicare TaxesThe $150 Test or the $2,500 Test Social Security and Medicare Tax Withholding 5. Penalty for filing taxes late Federal Income Tax WithholdingImplementation of lock-in letter. Penalty for filing taxes late Seasonal employees and employees not currently performing services. Penalty for filing taxes late Termination and re-hire of employees. Penalty for filing taxes late How To Figure Federal Income Tax Withholding 6. Penalty for filing taxes late Required Notice to Employees About Earned Income Credit (EIC) 7. Penalty for filing taxes late Depositing TaxesWhen To Deposit How To Deposit Deposit Penalties Employers of Both Farm and Nonfarm Workers 8. Penalty for filing taxes late Form 943 9. Penalty for filing taxes late Reporting Adjustments on Form 943Current Year Adjustments Prior Year Adjustments 10. Penalty for filing taxes late Federal Unemployment (FUTA) Tax 11. Penalty for filing taxes late Reconciling Wage Reporting Forms 13. Penalty for filing taxes late Federal Income Tax Withholding MethodsWage Bracket Method Percentage Method Alternative Methods of Federal Income Tax Withholding How To Get Tax Help 1. Penalty for filing taxes late Taxpayer Identification Numbers If you are required to withhold any federal income, social security, or Medicare taxes, you will need an employer identification number (EIN) for yourself. Penalty for filing taxes late Also, you will need the SSN of each employee and the name of each employee as shown on the employee's social security card. Penalty for filing taxes late Employer identification number (EIN). Penalty for filing taxes late   An employer identification number (EIN) is a nine-digit number that the IRS issues. Penalty for filing taxes late The digits are arranged as follows: 00-0000000. Penalty for filing taxes late It is used to identify the tax accounts of employers and certain others who have no employees. Penalty for filing taxes late Use your EIN on all of the items that you send to the IRS and SSA. Penalty for filing taxes late   If you do not have an EIN, you may apply for one online. Penalty for filing taxes late Visit IRS. Penalty for filing taxes late gov and click on the Apply for an EIN Online link under Tools. Penalty for filing taxes late 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. Penalty for filing taxes late Do not use a SSN in place of an EIN. Penalty for filing taxes late   If you do not have an EIN by the time a return is due, write “Applied For” and the date you applied for it in the space shown for the number. Penalty for filing taxes late If you took over another employer's business, do not use that employer's EIN. Penalty for filing taxes late   You should have only one EIN. Penalty for filing taxes late If you have more than one, and are not sure which one to use, call the toll-free Business and Specialty Tax Line at 1-800-829-4933 or 1-800-829-4059 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability). Penalty for filing taxes late Provide the EINs that you have, the name and address to which each number was assigned, and the address of your principal place of business. Penalty for filing taxes late The IRS will tell you which EIN to use. Penalty for filing taxes late   For more information, see Publication 1635 or Publication 583. Penalty for filing taxes late When you receive your EIN. Penalty for filing taxes late   If you are a new employer that indicated a federal tax obligation when requesting an EIN, you will be pre-enrolled in the Electronic Federal Tax Payment System (EFTPS). Penalty for filing taxes late You will receive information in your Employer Identification Number (EIN) Package about Express Enrollment and an additional mailing containing your EFTPS personal identification number (PIN) and instructions for activating your PIN. Penalty for filing taxes late Call the toll-free number located in your “How to Activate Your Enrollment” brochure to activate your enrollment and begin making your employment tax deposits. Penalty for filing taxes late If you outsource any of your payroll and related tax duties to a third party payer, such as a payroll service provider or reporting agent, be sure to tell them about your EFTPS enrollment. Penalty for filing taxes late Social security number (SSN). Penalty for filing taxes late   An employee's social security number (SSN) consists of nine digits arranged as follows: 000-00-0000. Penalty for filing taxes late You must obtain each employee's name and SSN as shown on the employee's social security card because you must enter them on Form W-2. Penalty for filing taxes late Do not accept a social security card that says “Not valid for employment. Penalty for filing taxes late ” A social security number issued with this legend does not permit employment. Penalty for filing taxes late You may, but are not required to, photocopy the social security card if the employee provides it. Penalty for filing taxes late If you do not show the employee's correct name and SSN on Form W-2, you may owe a penalty unless you have reasonable cause. Penalty for filing taxes late See Publication 1586, Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs. Penalty for filing taxes late Applying for a social security card. Penalty for filing taxes late   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 to SSA. Penalty for filing taxes late You can get Form SS-5 at SSA offices, by calling 1-800-772-1213 or 1-800-325-0778 (TTY), or from the SSA website at www. Penalty for filing taxes late socialsecurity. Penalty for filing taxes late gov/online/ss-5. Penalty for filing taxes late html. Penalty for filing taxes late The employee must complete and sign Form SS-5; it cannot be filed by the employer. Penalty for filing taxes late 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. Penalty for filing taxes late Applying for a social security number. Penalty for filing taxes late   If you file Form W-2 on paper and your employee has applied for an SSN but does not have one when you must file Form W-2, enter “Applied For” on the form. Penalty for filing taxes late If you are filing electronically, enter all zeros (000-00-0000) in the social security number field. Penalty for filing taxes late 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. Penalty for filing taxes late Furnish Copies B, C, and 2 of Form W-2c to the employee. Penalty for filing taxes late Up to 25 Forms W-2c per Form W-3c, Transmittal of Corrected Wage and Tax Statements, may be filed per session over the Internet, with no limit on the number of sessions. Penalty for filing taxes late For more information, visit SSA's Employer W-2 Filing Instructions & Information webpage at www. Penalty for filing taxes late socialsecurity. Penalty for filing taxes late gov/employer. Penalty for filing taxes late Advise your employee to correct the SSN on his or her original Form W-2. Penalty for filing taxes late Correctly record the employee's name and SSN. Penalty for filing taxes late   Record the name and number of each employee as they are shown on the employee's social security card. Penalty for filing taxes late 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. Penalty for filing taxes late 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. Penalty for filing taxes late   If the SSA issues the employee a replacement card after a name change, or a new card with a different social security number after a change in alien work status, file a Form W-2c to correct the name/SSN reported on the most recently filed Form W-2. Penalty for filing taxes late It is not necessary to correct other years if the previous name and SSN were used for years before the most recent Form W-2. Penalty for filing taxes late IRS individual taxpayer identification numbers (ITINs) for aliens. Penalty for filing taxes late   Do not accept an ITIN in place of an SSN for employee identification or for work. Penalty for filing taxes late An ITIN is issued for use by resident and nonresident aliens who need identification for tax purposes, but who are not eligible for U. Penalty for filing taxes late S. Penalty for filing taxes late employment. Penalty for filing taxes late The ITIN is a nine-digit number formatted like an SSN (for example, NNN-NN-NNNN). Penalty for filing taxes late However, it begins with the number “9” and has either a “7” or “8” as the fourth digit (for example, 9NN-7N-NNNN or 9NN-8N-NNNN). Penalty for filing taxes late    An individual with an ITIN who later becomes eligible to work in the United States must obtain an SSN. Penalty for filing taxes late 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 in this section. Penalty for filing taxes late Do not use an ITIN in place of an SSN on Form W-2. Penalty for filing taxes late Verification of social security numbers. Penalty for filing taxes late   Employers and authorized reporting agents can use the Social Security Number Verification Service (SSNVS) to instantly verify up to 10 employee names and SSNs (per screen) at a time, or submit an electronic file of up to 250,000 names and SSNs and usually receive results the next business day. Penalty for filing taxes late Visit www. Penalty for filing taxes late socialsecurity. Penalty for filing taxes late gov/employer/ssnv. Penalty for filing taxes late htm for more information. Penalty for filing taxes late Registering for SSNVS. Penalty for filing taxes late   You must register online and receive authorization from your employer to use SSNVS. Penalty for filing taxes late To register, visit SSA's website at www. Penalty for filing taxes late socialsecurity. Penalty for filing taxes late gov/employer and click on the Business Services Online link. Penalty for filing taxes late Follow the registration instructions to obtain a user identification (ID) and password. Penalty for filing taxes late You will need to provide the following information about yourself and your company. Penalty for filing taxes late Name. Penalty for filing taxes late SSN. Penalty for filing taxes late Date of birth. Penalty for filing taxes late Type of employer. Penalty for filing taxes late EIN. Penalty for filing taxes late Company name, address, and telephone number. Penalty for filing taxes late Email address. Penalty for filing taxes late When you have completed the online registration process, SSA will mail a one-time activation code to your employer. Penalty for filing taxes late You must enter the activation code online to use SSNVS. Penalty for filing taxes late 2. Penalty for filing taxes late Who Are Employees? Generally, employees are defined either under common law or under statutes for certain situations. Penalty for filing taxes late See Publication 15-A for details on statutory employees and nonemployees. Penalty for filing taxes late Employee status under common law. Penalty for filing taxes late   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. Penalty for filing taxes late This is so even when you give the employee freedom of action. Penalty for filing taxes late What matters is that you have the right to control the details of how the services are performed. Penalty for filing taxes late See Publication 15-A for more information on how to determine whether an individual providing services is an independent contractor or an employee. Penalty for filing taxes late If an employer-employee relationship exists, it does not matter what it is called. Penalty for filing taxes late The employee may be called an agent or independent contractor. Penalty for filing taxes late It also does not matter how payments are measured or paid, what they are called, or if the employee works full or part time. Penalty for filing taxes late You are responsible for withholding and paying employment taxes for your employees. Penalty for filing taxes late You are also required to file employment tax returns. Penalty for filing taxes late These requirements do not apply to amounts that you pay to independent contractors. Penalty for filing taxes late The rules discussed in this publication apply only to workers who are your employees. Penalty for filing taxes late In general, you are an employer of farmworkers if your employees: Raise or harvest agricultural or horticultural products on your farm (including the raising and feeding of livestock); Work in connection with the operation, management, conservation, improvement, or maintenance of your farm and its tools and equipment; Provide services relating to salvaging timber, or clearing land of brush and other debris, left by a hurricane (also known as hurricane labor); Handle, process, or package any agricultural or horticultural commodity if you produced over half of the commodity (for a group of up to 20 unincorporated operators, all of the commodity); or Do work for you related to cotton ginning, turpentine, gum resin products, or the operation and maintenance of irrigation facilities. Penalty for filing taxes late For this purpose, the term “farm” includes stock, dairy, poultry, fruit, fur-bearing animal, and truck farms, as well as plantations, ranches, nurseries, ranges, greenhouses or other similar structures used primarily for the raising of agricultural or horticultural commodities, and orchards. Penalty for filing taxes late Farmwork does not include reselling activities that do not involve any substantial activity of raising agricultural or horticultural commodities, such as a retail store or a greenhouse used primarily for display or storage. Penalty for filing taxes late The table in section 12, How Do Employment Taxes Apply to Farmwork , distinguishes between farm and nonfarm activities, and also addresses rules that apply in special situations. Penalty for filing taxes late Crew Leaders If you are a crew leader, you are an employer of farmworkers. Penalty for filing taxes late A crew leader is a person who furnishes and pays (either on his or her own behalf or on behalf of the farm operator) workers to do farmwork for the farm operator. Penalty for filing taxes late If there is no written agreement between you and the farm operator stating that you are his or her employee and if you pay the workers (either for yourself or for the farm operator), then you are a crew leader. Penalty for filing taxes late For FUTA tax rules, see section 10. Penalty for filing taxes late Business Owned and Operated by Spouses If you and your spouse jointly own and operate a farm or nonfarm business and share in the profits and losses, you are partners in a partnership, whether or not you have a formal partnership agreement. Penalty for filing taxes late See Publication 541, Partnerships, for more details. Penalty for filing taxes late The partnership is considered the employer of any employees, and is liable for any employment taxes due on wages paid to its employees. Penalty for filing taxes late Exception—Qualified joint venture. Penalty for filing taxes late   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. Penalty for filing taxes late 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). Penalty for filing taxes late   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. Penalty for filing taxes late Each spouse must also file a separate Schedule SE to pay self-employment taxes, as applicable. Penalty for filing taxes late   Spouses using the qualified joint venture rules are treated as sole proprietors for federal tax purposes and generally do not need an EIN. Penalty for filing taxes late 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. Penalty for filing taxes late Generally, filing as a qualified joint venture will not increase the spouses' total tax owed on the joint income tax return. Penalty for filing taxes late 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. Penalty for filing taxes late    Note. Penalty for filing taxes late If your spouse is your employee, not your partner, you must pay social security and Medicare taxes for him or her. Penalty for filing taxes late   For more information on qualified joint ventures, visit IRS. Penalty for filing taxes late gov and enter “qualified joint venture” in the search box. Penalty for filing taxes late Exception—Community income. Penalty for filing taxes late   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. Penalty for filing taxes late S. Penalty for filing taxes late possession, you can treat the business either as a sole proprietorship (of the spouse who carried on the business) or a partnership. Penalty for filing taxes late You may still make an election to be taxed as a qualified joint venture instead of a partnership. Penalty for filing taxes late See Exception—Qualified joint venture , earlier in this section. Penalty for filing taxes late 3. Penalty for filing taxes late Wages and Other Compensation Cash wages that you pay to employees for farmwork are generally subject to social security tax and Medicare tax. Penalty for filing taxes late You may also be required to withhold, deposit, and report Additional Medicare Tax. Penalty for filing taxes late See section 4 for more information. Penalty for filing taxes late If the wages are subject to social security and Medicare taxes, they are also subject to federal income tax withholding. Penalty for filing taxes late You may also be liable for FUTA tax, which is not withheld by you or paid by the employee. Penalty for filing taxes late FUTA tax is discussed in section 10. Penalty for filing taxes late Cash wages include checks, money orders, etc. Penalty for filing taxes late Do not count as cash wages the value of food, lodging, and other noncash items. Penalty for filing taxes late For more information on what payments are considered taxable wages, see Publication 15 (Circular E). Penalty for filing taxes late Commodity wages. Penalty for filing taxes late   Commodity wages are not cash and are not subject to social security and Medicare taxes or federal income tax withholding. Penalty for filing taxes late However, noncash payments, including commodity wages, are treated as cash wages (see above) if the substance of the transaction is a cash payment. Penalty for filing taxes late These noncash payments are subject to social security and Medicare taxes and federal income tax withholding. Penalty for filing taxes late Other compensation. Penalty for filing taxes late   Publications 15-A and 15-B discuss other forms of compensation that may be taxable. Penalty for filing taxes late Family members. Penalty for filing taxes late   Generally, the wages that you pay to family members who are your employees are subject to social security and Medicare taxes, federal income tax withholding, and FUTA tax. Penalty for filing taxes late However, certain exemptions may apply for your child, spouse, or parent. Penalty for filing taxes late See the table, How Do Employment Taxes Apply to Farmwork , in section 12. Penalty for filing taxes late Household employees. Penalty for filing taxes late   The wages of an employee who performs household services, such as a maid, babysitter, gardener, or cook, in your home are not subject to social security and Medicare taxes if you pay that employee cash wages of less than $1,900 in 2014. Penalty for filing taxes late   Social security and Medicare taxes do not apply to cash wages for housework in your private home if it was done by your spouse or your child under age 21. Penalty for filing taxes late Nor do the taxes apply to housework done by your parent unless: You have a child living in your home who is under age 18 or has a physical or mental condition that requires care by an adult for at least 4 continuous weeks in a calendar quarter, and You are a widow or widower, or divorced and not remarried, or have a spouse in the home who, because of a physical or mental condition, cannot care for your child for at least 4 continuous weeks in the quarter. Penalty for filing taxes late   For more information, see Publication 926, Household Employer's Tax Guide. Penalty for filing taxes late    Wages for household work may not be a deductible farm expense. Penalty for filing taxes late See Publication 225, Farmer's Tax Guide. Penalty for filing taxes late Share farmers. Penalty for filing taxes late   You do not have to withhold or pay social security and Medicare taxes on amounts paid to share farmers under share-farming arrangements. Penalty for filing taxes late Compensation paid to H-2A visa holders. Penalty for filing taxes late   Report compensation of $600 or more paid to foreign agricultural workers who entered the country on H-2A visas in box 1 of Form W-2 but do not report it as social security wages (box 3) or Medicare wages (box 5) on Form W-2 because compensation paid to H-2A workers for agricultural labor performed in connection with this visa is not subject to social security and Medicare taxes. Penalty for filing taxes late On Form W-2, do not check box 13 (Statutory employee), as H-2A workers are not statutory employees. Penalty for filing taxes late   An employer is not required to withhold federal income tax from compensation it pays an H-2A worker for agricultural labor performed in connection with this visa unless the worker asks for withholding and the employer agrees. Penalty for filing taxes late In that case, the worker must give the employer a completed Form W-4. Penalty for filing taxes late Federal income tax withheld should be reported in box 2 of Form W-2. Penalty for filing taxes late These reporting rules apply when the H-2A worker provides his or her taxpayer identification number (TIN) to the employer. Penalty for filing taxes late For rules relating to backup withholding and reporting when the H-2A worker does not provide a TIN, see the Instructions for Form 1099-MISC and the Instructions for Form 945. Penalty for filing taxes late 4. Penalty for filing taxes late Social Security and Medicare Taxes Generally, you must withhold social security and Medicare taxes on all cash wage payments that you make to your employees. Penalty for filing taxes late You may also be required to withhold Additional Medicare Tax. Penalty for filing taxes late For more information, see Additional Medicare Tax withholding , later. Penalty for filing taxes late The $150 Test or the $2,500 Test All cash wages that you pay to an employee during the year for farmwork are subject to social security and Medicare taxes and federal income tax withholding if either of the two tests below is met. Penalty for filing taxes late You pay cash wages to an employee of $150 or more in a year for farmwork (count all cash wages paid on a time, piecework, or other basis). Penalty for filing taxes late The $150 test applies separately to each farmworker that you employ. Penalty for filing taxes late If you employ a family of workers, each member is treated separately. Penalty for filing taxes late Do not count wages paid by other employers. Penalty for filing taxes late The total that you pay for farmwork (cash and noncash) to all your employees is $2,500 or more during the year. Penalty for filing taxes late Exceptions. Penalty for filing taxes late   The $150 and $2,500 tests do not apply to wages that you pay to a farmworker who receives less than $150 in annual cash wages and the wages are not subject to social security and Medicare taxes, or federal income tax withholding, even if you pay $2,500 or more in that year to all of your farmworkers if the farmworker: Is employed in agriculture as a hand-harvest laborer, Is paid piece rates in an operation that is usually paid on a piece-rate basis in the region of employment, Commutes daily from his or her permanent home to the farm, and Had been employed in agriculture less than 13 weeks in the preceding calendar year. Penalty for filing taxes late   Amounts that you pay to these seasonal farmworkers, however, count toward the $2,500-or-more test to determine whether wages that you pay to other farmworkers are subject to social security and Medicare taxes. Penalty for filing taxes late Social Security and Medicare Tax Withholding The social security tax rate is 6. Penalty for filing taxes late 2%, for both the employee and employer, on the first $117,000 paid to each employee. Penalty for filing taxes late You must withhold at this rate from each employee and pay a matching amount. Penalty for filing taxes late The Medicare tax rate is 1. Penalty for filing taxes late 45% each for the employee and employer on all wages. Penalty for filing taxes late You must withhold at this rate from each employee and pay a matching amount. Penalty for filing taxes late There is no wage base limit for Medicare tax; all covered wages are subject to Medicare tax. Penalty for filing taxes late Social security and Medicare taxes apply to most payments of sick pay, including payments made by third parties such as insurance companies. Penalty for filing taxes late For details, see Publication 15-A. Penalty for filing taxes late Additional Medicare Tax withholding. Penalty for filing taxes late   In addition to withholding Medicare tax at 1. Penalty for filing taxes late 45%, you must withhold a 0. Penalty for filing taxes late 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. Penalty for filing taxes late You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Penalty for filing taxes late Additional Medicare Tax is only imposed on the employee. Penalty for filing taxes late There is no employer share of Additional Medicare Tax. Penalty for filing taxes late All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold. Penalty for filing taxes late   For more information on what wages are subject to Medicare tax, see the chart, Special Rules for Various Types of Services and Payments, in section 15 of Publication 15 (Circular E). Penalty for filing taxes late For more information on Additional Medicare Tax, visit IRS. Penalty for filing taxes late gov and enter “Additional Medicare Tax” in the search box. Penalty for filing taxes late Employee share paid by employer. Penalty for filing taxes late   If you would rather pay a household or agricultural employee's share of the social security and Medicare taxes without withholding them from his or her wages, you may do so. Penalty for filing taxes late If you do not withhold the taxes, however, you must still pay them. Penalty for filing taxes late Any employee social security and Medicare taxes that you pay is additional income to the employee. Penalty for filing taxes late Include it in box 1 of the employee's Form W-2, but do not count it as social security and Medicare wages and do not include it in boxes 3 and 5. Penalty for filing taxes late Also, do not count the additional income as wages for FUTA tax purposes. Penalty for filing taxes late Different rules apply to employer payments of social security and Medicare taxes for non-household and non-agricultural employees. Penalty for filing taxes late See section 7 of Publication 15-A. Penalty for filing taxes late Withholding social security and Medicare taxes on nonresident alien employees. Penalty for filing taxes late   In general, if you pay wages to nonresident alien employees, you must withhold social security and Medicare taxes as you would for a U. Penalty for filing taxes late S. Penalty for filing taxes late citizen or resident alien. Penalty for filing taxes late However, see Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities, for exceptions to this general rule. Penalty for filing taxes late Also see Compensation paid to H-2A visa holders in section 3. Penalty for filing taxes late Religious exemption. Penalty for filing taxes late    An exemption from social security and Medicare taxes is available to members of a recognized religious sect opposed to public insurance. Penalty for filing taxes late This exemption is available only if both the employee and the employer are members of the sect. Penalty for filing taxes late   For more information, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. Penalty for filing taxes late 5. Penalty for filing taxes late Federal Income Tax Withholding Farmers and crew leaders must withhold federal income tax from the wages of farmworkers if the wages are subject to social security and Medicare taxes. Penalty for filing taxes late The amount to withhold is figured on gross wages before taking out social security and Medicare taxes, union dues, insurance, etc. Penalty for filing taxes late You may use one of several methods to determine the amount of federal income tax withholding. Penalty for filing taxes late They are discussed in section 13. Penalty for filing taxes late Form W-4. Penalty for filing taxes late   To know how much federal income tax to withhold from employees' wages, you should have a Form W-4 on file for each employee. Penalty for filing taxes late 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. Penalty for filing taxes late Advise your employees to use the IRS Withholding Calculator on the IRS website at www. Penalty for filing taxes late irs. Penalty for filing taxes late gov/individuals for help in determining how many withholding allowances to claim on their Form W-4. Penalty for filing taxes late   Ask each new employee to give you a signed Form W-4 when starting work. Penalty for filing taxes late Make the form effective with the first wage payment. Penalty for filing taxes late If a new employee does not give you a completed Form W-4, withhold tax as if he or she is single, with no withholding allowances. Penalty for filing taxes late Forms in Spanish. Penalty for filing taxes late   You can provide Formulario W-4(SP) in place of Form W-4 to your Spanish-speaking employees. Penalty for filing taxes late For more information, see Publicación 17(SP). Penalty for filing taxes late Effective date of Form W-4. Penalty for filing taxes late   A Form W-4 remains in effect until the employee gives you a new one. Penalty for filing taxes late When you receive a new Form W-4, do not adjust withholding for pay periods before the effective date of the new form. Penalty for filing taxes late Do not adjust withholding retroactively. Penalty for filing taxes late If an employee gives you a replacement 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. Penalty for filing taxes late 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. Penalty for filing taxes late A Form W-4 that makes a change for the next calendar year will not take effect in the current calendar year. Penalty for filing taxes late Completing Form W-4. Penalty for filing taxes late   The amount of federal income tax withholding is based on marital status and withholding allowances. Penalty for filing taxes late Your employees may not base their withholding amounts on a fixed dollar amount or percentage. Penalty for filing taxes late However, the 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. Penalty for filing taxes late   Employees may claim fewer withholding allowances than they are entitled to claim. Penalty for filing taxes late They may do this to ensure that they have enough withholding or to offset other sources of taxable income that are not subject to withholding. Penalty for filing taxes late   See Publication 505, Tax Withholding and Estimated Tax, for more information about completing Form W-4. Penalty for filing taxes late Along with Form W-4, you may wish to order Publication 505 for use by your employees. Penalty for filing taxes late    Do not accept any withholding or estimated tax payments from your employees in addition to withholding based on their Form W-4. Penalty for filing taxes late If an employee wants additional withholding, he or she 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. Penalty for filing taxes late Exemption from federal income tax withholding. Penalty for filing taxes late   Generally, an employee may claim exemption from federal income tax withholding because he or she had no federal income tax liability last year and expects none this year. Penalty for filing taxes late See the Form W-4 instructions for more information. Penalty for filing taxes late However, the wages are still subject to social security and Medicare taxes. Penalty for filing taxes late   A Form W-4 claiming exemption from withholding is effective when it is filed with the employer and only for that calendar year. Penalty for filing taxes late 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. Penalty for filing taxes late If the employee does not give you a new Form W-4 by February 15, withhold tax based on the last valid Form W-4 you have for the employee that did not claim an exemption from withholding or, if one does not exist, withhold as if he or she is single with zero withholding allowances. Penalty for filing taxes late If the employee provides a new Form W-4 claiming an exemption from withholding on February 16 or later, you may apply the exemption to future wages, but do not refund taxes withheld while the exempt status was not in place. Penalty for filing taxes late Withholding income taxes on the wages of nonresident alien employees. Penalty for filing taxes late   In general, you must withhold federal income taxes on the wages of nonresident alien employees. Penalty for filing taxes late However, see Publication 515 for exceptions to this general rule. Penalty for filing taxes late Also see Compensation paid to H-2A visa workers in section 3. Penalty for filing taxes late Withholding adjustment for nonresident alien employees. Penalty for filing taxes late   A special procedure applies for figuring the amount of income tax to withhold from wages of nonresident alien employees performing services within the United States for wages paid in 2014. Penalty for filing taxes late This procedure requires a special chart to be used with the withholding tables to determine the amount to withhold from the wages of the nonresident alien employee. Penalty for filing taxes late See Withholding adjustment for nonresident alien employees in section 9 of Publication 15 (Circular E). Penalty for filing taxes late Nonresident alien employee's Form W-4. Penalty for filing taxes late   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 Korea, 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. Penalty for filing taxes late   If you maintain an electronic Form W-4 system, you should provide a field for nonresident alien employees to enter nonresident alien status in lieu of writing “Nonresident Alien” or “NRA” above the dotted line on line 6. Penalty for filing taxes late    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. Penalty for filing taxes late Form 8233. Penalty for filing taxes late   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. Penalty for filing taxes late See Publication 515 for details. Penalty for filing taxes late IRS review of requested Forms W-4. Penalty for filing taxes late   When requested by the IRS, you must make original Forms W-4 available for inspection by an IRS employee. Penalty for filing taxes late You may also be directed to send certain Forms W-4 to the IRS. Penalty for filing taxes late 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. Penalty for filing taxes late 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. Penalty for filing taxes late The IRS may also require you to submit copies of Form W-4 to the IRS as directed by a revenue procedure or notice published in the Internal Revenue Bulletin. Penalty for filing taxes late When we refer to Form W-4, the same rules apply to Formulario W-4(SP), its Spanish translation. Penalty for filing taxes late   After submitting a copy of the 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). Penalty for filing taxes late However, if the IRS later notifies you in writing that the employee is not entitled to claim a complete exemption from withholding or more than the maximum number of withholding allowances specified by the IRS in the written notice, withhold federal income tax based on the effective date, marital status, and maximum number of withholding allowances specified in the notice (commonly referred to as a “lock-in letter”). Penalty for filing taxes late Initial lock-in letter. Penalty for filing taxes late   The IRS uses information reported on Form W-2 to identify employees with withholding compliance problems. Penalty for filing taxes late In some cases, where a serious under-withholding problem is found to exist for a particular employee, the IRS may issue a lock-in letter to the employer specifying the maximum number of withholding allowances and marital status permitted for a specific employee. Penalty for filing taxes late You will also receive a copy for the employee that identifies the maximum number of withholding allowances permitted and the process by which the employee can provide additional information to the IRS for purposes of determining the appropriate number of withholding allowances. Penalty for filing taxes late If the employee is employed by you as of the date of the notice, you must furnish the employee copy to the employee within 10 business days of receipt. Penalty for filing taxes late You may follow any reasonable business practice to furnish the employee copy to the employee. Penalty for filing taxes late Implementation of lock-in letter. Penalty for filing taxes late   When you receive the notice specifying the maximum number of withholding allowances and marital status permitted, you may not withhold immediately on the basis of the notice. Penalty for filing taxes late You must begin withholding tax on the basis of the notice for any wages paid after the date specified in the notice. Penalty for filing taxes late The delay between your receipt of the notice and the date to begin the withholding on the basis of the notice permits the employee to contact the IRS. Penalty for filing taxes late Seasonal employees and employees not currently performing services. Penalty for filing taxes late   If you receive a notice for an employee who is not currently performing services for you, you are still required to furnish the employee copy to the employee and withhold based on the notice if any of the following apply. Penalty for filing taxes late You are paying wages for the employee's prior services and the wages are subject to income tax withholding on or after the date specified in the notice. Penalty for filing taxes late You reasonably expect the employee to resume services within 12 months of the date of the notice. Penalty for filing taxes late The employee is on a bona fide leave of absence that does not exceed 12 months or the employee has a right to reemployment after the leave of absence. Penalty for filing taxes late Termination and re-hire of employees. Penalty for filing taxes late   If you are required to furnish and withhold based on the notice and the employment relationship is terminated after the date of the notice, you must continue to withhold based on the notice if you continue to pay any wages subject to income tax withholding. Penalty for filing taxes late You must also withhold based on the notice or modification notice (explained next) if the employee resumes the employment relationship with you within 12 months after the termination of the employment relationship. Penalty for filing taxes late Modification notice. Penalty for filing taxes late   After issuing the notice specifying the maximum number of withholding allowances and marital status permitted, the IRS may issue a subsequent notice (modification notice) that modifies the original notice. Penalty for filing taxes late The modification notice may change the marital status and/or the number of withholding allowances permitted. Penalty for filing taxes late You must withhold federal income tax based on the effective date specified in the modification notice. Penalty for filing taxes late New Form W-4 after IRS notice. Penalty for filing taxes late   After the IRS issues a notice or modification notice, if the employee provides you with a new Form W-4 claiming complete exemption from withholding or claims a marital status, a number of withholding allowances, and any additional withholding that results in less withholding than would result under the IRS notice or modification notice, you must disregard the new Form W-4. Penalty for filing taxes late You are required to withhold on the basis of the notice or modification notice unless the IRS subsequently notifies you to withhold based on the new Form W-4. Penalty for filing taxes late If the employee wants to put a new Form W-4 into effect that results in less withholding than required, the employee must contact the IRS. Penalty for filing taxes late   If, after you receive an IRS notice or modification notice, your employee provides you with a new Form W-4 that does not claim exemption from federal income tax withholding and claims a marital status, a number of withholding allowances, and any additional withholding that results in more withholding than would result under the notice or modification notice, you must withhold tax on the basis of that new Form W-4. Penalty for filing taxes late Otherwise, disregard any subsequent Forms W-4 provided by the employee and withhold based on the IRS notice or modification notice. Penalty for filing taxes late Substitute Forms W-4. Penalty for filing taxes late   You are encouraged to have your employees use the official version of Form W-4 to claim withholding allowances or exemption from withholding. Penalty for filing taxes late Call the IRS at 1-800-TAX-FORM (1-800-829-3676) or visit IRS. Penalty for filing taxes late gov to obtain copies of Form W-4. Penalty for filing taxes late   You may use a substitute version of Form W-4 to meet your business needs. Penalty for filing taxes late However, your substitute Form W-4 must contain language that is identical to the official Form W-4 and your form must meet all current IRS rules for substitute forms. Penalty for filing taxes late At the time that you provide your substitute form to the employee, you must provide him or her with all tables, instructions, and worksheets from the current Form W-4. Penalty for filing taxes late   You cannot accept a substitute Form W-4 developed by an employee, and the employee submitting such form will be treated as failing to furnish a Form W-4. Penalty for filing taxes late However, continue to use any valid Forms W-4 developed by your employees that you accepted before October 11, 2007. Penalty for filing taxes late Invalid Forms W-4. Penalty for filing taxes late   Any unauthorized change or addition to Form W-4 makes it invalid. Penalty for filing taxes late This includes taking out any language by which the employee certifies that the form is correct. Penalty for filing taxes late A Form W-4 is also invalid if, by the date an employee gives it to you, he or she indicates in any way that it is false. Penalty for filing taxes late An employee who submits a false Form W-4 may be subject to a $500 penalty. Penalty for filing taxes late You may treat a Form W-4 as invalid if the employee wrote “exempt” on line 7 and also entered a number on line 5 or an amount on line 6. Penalty for filing taxes late   When you get an invalid Form W-4, do not use it to figure federal income tax withholding. Penalty for filing taxes late Tell the employee that it is invalid and ask for another one. Penalty for filing taxes late If the employee does not give you a valid one, withhold taxes as if the employee was single and claiming no withholding allowances. Penalty for filing taxes late However, if you have an earlier Form W-4 for this worker that is valid, withhold as you did before. Penalty for filing taxes late   For additional information about these rules, see Treasury Decision 9337, 2007-35 I. Penalty for filing taxes late R. Penalty for filing taxes late B. Penalty for filing taxes late 455, available at www. Penalty for filing taxes late irs. Penalty for filing taxes late gov/irb/2007-35_IRB/ar10. Penalty for filing taxes late html. Penalty for filing taxes late Amounts exempt from levy on wages, salary, and other income. Penalty for filing taxes late   If you receive a Notice of Levy on Wages, Salary, and Other Income—Forms 668-W(ACS), 668-W(c)(DO), or 668-W(ICS), you must withhold amounts as described in the instructions for these forms. Penalty for filing taxes late Publication 1494, Tables for Figuring Amount Exempt From Levy on Wages, Salary, and Other Income—Forms 668-W(ACS), 668-W(c)(DO), and 668-W(ICS), shows the exempt amount. Penalty for filing taxes late If a levy issued in a prior year is still in effect and the taxpayer submits a new Statement of Exemptions and Filing Status, use the current year Publication 1494 to compute the exempt amount. Penalty for filing taxes late How To Figure Federal Income Tax Withholding There are several ways to figure federal income tax withholding. Penalty for filing taxes late Wage bracket tables. Penalty for filing taxes late See section 13 for directions on how to use the tables. Penalty for filing taxes late Percentage method. Penalty for filing taxes late See section 13 for directions on how to use the percentage method. Penalty for filing taxes late Alternative formula tables for percentage method withholding. Penalty for filing taxes late See Publication 15-A. Penalty for filing taxes late Wage bracket percentage method withholding tables. Penalty for filing taxes late See Publication 15-A. Penalty for filing taxes late Other alternative methods. Penalty for filing taxes late See Publication 15-A. Penalty for filing taxes late Employers with automated payroll systems will find the two alternative formula tables and the two alternative wage bracket percentage method tables in Publication 15-A useful. Penalty for filing taxes late If an employee wants additional federal tax withheld, have the employee show the extra amount on Form W-4. Penalty for filing taxes late Supplemental wages. Penalty for filing taxes late   Supplemental wages are wage payments to an employee that are not regular wages. Penalty for filing taxes late They include, but are not limited to, bonuses, commissions, overtime pay, accumulated sick leave, severance pay, awards, prizes, back pay and retroactive pay increases for current employees, and payments for nondeductible moving expenses. Penalty for filing taxes late Other payments subject to the supplemental wage rules include taxable fringe benefits and expense allowances paid under a nonaccountable plan. Penalty for filing taxes late   If you pay supplemental wages with regular wages but do not specify the amount of each, withhold federal income tax as if the total was a single payment for a regular payroll period. Penalty for filing taxes late   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 federal income tax from your employee's regular wages. Penalty for filing taxes late If you withheld federal 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. Penalty for filing taxes late Withhold a flat 25% (no other percentage allowed). Penalty for filing taxes late If the supplemental wages are paid concurrently with regular wages, add the supplemental wages to the concurrently paid regular wages. Penalty for filing taxes late 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. Penalty for filing taxes late Figure the income tax withholding as if the total of the regular wages and supplemental wages is a single payment. Penalty for filing taxes late Subtract the tax withheld from the regular wages. Penalty for filing taxes late Withhold the remaining tax from the supplemental wages. Penalty for filing taxes late 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 previous supplemental wage payments, and withhold the remaining tax from the current payment of supplemental wages. Penalty for filing taxes late If you did not withhold federal income tax from the employee's regular wages in the current or immediately preceding calendar year, use method 1-b above. Penalty for filing taxes late This would occur, for example, when the value of the employee's withholding allowances claimed on Form W-4 is more than the wages. Penalty for filing taxes late    Separate rules apply to any supplemental wages exceeding $1 million that you pay to an individual during the year. Penalty for filing taxes late See section 7 in Publication 15 (Circular E) for details. Penalty for filing taxes late   Regardless of the method that you use to withhold federal income tax on supplemental wages, they are generally subject to social security, Medicare, and FUTA taxes. Penalty for filing taxes late 6. Penalty for filing taxes late Required Notice to Employees About Earned Income Credit (EIC) You must notify employees who have no federal income tax withheld that they may be able to claim a tax refund because of the EIC. Penalty for filing taxes late Although you do not have to notify employees who claim exemption from withholding on Form W-4 about the EIC, you are encouraged to notify any employees whose wages for 2013 were less than $46,227 ($51,567 if married filing jointly) that they may be eligible to claim the credit for 2013. Penalty for filing taxes late This is because eligible employees may get a refund of the amount of EIC that is more than the tax that they owe. Penalty for filing taxes late You will meet the notification requirement if you issue to the employee Form W-2 with the EIC notice on the back of Copy B, or a substitute Form W-2 with the same statement. Penalty for filing taxes late You may also meet the requirement by providing Notice 797, Possible Federal Tax Refund Due to the Earned Income Credit (EIC), or your own statement that contains the same wording. Penalty for filing taxes late If a substitute Form W-2 is given to the employee on time but does not have the required statement, you must notify the employee within 1 week of the date that the substitute Form W-2 is given. Penalty for filing taxes late If Form W-2 is required but is not given on time, you must give the employee Notice 797 or your written statement by the date that Form W-2 is required to be given. Penalty for filing taxes late If Form W-2 is not required, you must notify the employee by February 7, 2014. Penalty for filing taxes late 7. Penalty for filing taxes late Depositing Taxes Generally, you must deposit both the employer and employee shares of social security and Medicare taxes and federal income tax withheld. Penalty for filing taxes late You must use electronic funds transfer to make all federal tax deposits. Penalty for filing taxes late See How To Deposit , later in this section. Penalty for filing taxes late The credit against employment taxes for COBRA premium assistance payments is treated as a deposit of taxes on the first day of your return period. Penalty for filing taxes late For more information, see COBRA premium assistance credit under Introduction. Penalty for filing taxes late Payment with return. Penalty for filing taxes late   You may make payments with Forms 943 or 945 instead of depositing if one of the following applies. Penalty for filing taxes late You report less than a $2,500 tax liability for the year (Form 943, line 11; Form 945, line 3) and you pay in full with a return that is filed on time. Penalty for filing taxes late However, if you are unsure that you will report less than $2,500, deposit under the rules explained in this section so that you will not be subject to failure-to-deposit penalties. Penalty for filing taxes late You are a monthly schedule depositor and make a payment in accordance with the Accuracy of Deposits Rule discussed later in this section. Penalty for filing taxes late This payment may be $2,500 or more. Penalty for filing taxes late Only monthly schedule depositors, defined later, are allowed to make an Accuracy of Deposits Rule payment with the return. Penalty for filing taxes late Semiweekly schedule depositors must timely deposit the amount. Penalty for filing taxes late See Accuracy of Deposits Rule and How To Deposit, later in this section. Penalty for filing taxes late When To Deposit If you employ both farm and nonfarm workers, do not combine the taxes reportable on Forms 941 or 944 with Form 943 to decide whether to make a deposit. Penalty for filing taxes late See Employers of Both Farm and Nonfarm Workers, later in this section. Penalty for filing taxes late The rules for determining when to deposit Form 943 taxes are discussed below. Penalty for filing taxes late See section 10 for the separate rules that apply to FUTA tax. Penalty for filing taxes late Under these rules, you are classified as either a monthly schedule depositor or a semiweekly schedule depositor. Penalty for filing taxes late The terms “monthly schedule depositor” and “semiweekly schedule depositor” do not refer to how often your business pays its employees or how often you are required to make deposits. Penalty for filing taxes late The terms identify which set of rules you must follow when you incur a tax liability (for example, when you have a payday). Penalty for filing taxes late The deposit schedule that you must use for a calendar year is determined from the tax liability reported on your Form 943, line 9, for the lookback period, discussed next. Penalty for filing taxes late If you reported $50,000 or less of Form 943 taxes for the lookback period, you are a monthly schedule depositor. Penalty for filing taxes late If you reported more than $50,000 of Form 943 taxes for the lookback period, you are a semiweekly schedule depositor. Penalty for filing taxes late Lookback period. Penalty for filing taxes late   The lookback period is the second calendar year preceding the current calendar year. Penalty for filing taxes late For example, the lookback period for 2014 is 2012. Penalty for filing taxes late Example of deposit schedule based on lookback period. Penalty for filing taxes late Rose Co. Penalty for filing taxes late reported taxes on Form 943 as follows. Penalty for filing taxes late 2012 — $48,000 2013 — $60,000 Rose Co. Penalty for filing taxes late is a monthly schedule depositor for 2014 because its taxes for the lookback period ($48,000 for calendar year 2012) were not more than $50,000. Penalty for filing taxes late However, for 2015, Rose Co. Penalty for filing taxes late is a semiweekly schedule depositor because the total taxes before adjustment for its lookback period ($60,000 for calendar year 2013) exceeded $50,000. Penalty for filing taxes late Adjustments to lookback period taxes. Penalty for filing taxes late   To determine your taxes for the lookback period, use only the tax that you reported on the original return (Form 943, line 9). Penalty for filing taxes late Do not include adjustments shown on Form 943-X, Adjusted Employer's Annual Federal Tax Return for Agricultural Employees or Claim for Refund. Penalty for filing taxes late Example of adjustments. Penalty for filing taxes late An employer originally reported total tax of $45,000 for the lookback period in 2012. Penalty for filing taxes late The employer discovered during March 2014 that the tax reported for the lookback period was understated by $10,000 and corrected this error by filing Form 943-X. Penalty for filing taxes late The total tax reported in the lookback period is still $45,000. Penalty for filing taxes late The $10,000 adjustment is also not treated as part of the 2014 taxes. Penalty for filing taxes late Deposit period. Penalty for filing taxes late   The term “deposit period” refers to the period during which tax liabilities are accumulated for each required deposit due date. Penalty for filing taxes late For monthly schedule depositors, the deposit period is a calendar month. Penalty for filing taxes late The deposit periods for semiweekly schedule depositors are Wednesday through Friday and Saturday through Tuesday. Penalty for filing taxes late Monthly Deposit Schedule If the tax liability reported on Form 943, line 9, for the lookback period is $50,000 or less, you are a monthly schedule depositor for the current year. Penalty for filing taxes late You must deposit Form 943 taxes on payments made during a calendar month by the 15th day of the following month. Penalty for filing taxes late Monthly schedule example. Penalty for filing taxes late   Red Co. Penalty for filing taxes late is a seasonal employer and a monthly schedule depositor. Penalty for filing taxes late It pays wages each Friday. Penalty for filing taxes late It paid wages during August 2014, but did not pay any wages during September. Penalty for filing taxes late Red Co. Penalty for filing taxes late must deposit the combined tax liabilities for the August paydays by September 15. Penalty for filing taxes late Red Co. Penalty for filing taxes late does not have a deposit requirement for September (that is, due by October 15, 2014) because no wages were paid in September; therefore, it did not have a tax liability for September. Penalty for filing taxes late New employers. Penalty for filing taxes late   For agricultural employers, your tax liability for any year in the lookback period before the date you started or acquired your business is considered to be zero. Penalty for filing taxes late Therefore, you are a monthly schedule depositor for the first and second calendar years of your agricultural business (but see the $100,000 Next-Day Deposit Rule , later in this section). Penalty for filing taxes late Semiweekly Deposit Schedule You are a semiweekly schedule depositor for a calendar year if the tax liability on Form 943, line 9, during your lookback period was more than $50,000. Penalty for filing taxes late Under the semiweekly deposit schedule, deposit Form 943 taxes for payments made on Wednesday, Thursday, and/or Friday by the following Wednesday. Penalty for filing taxes late Deposit amounts accumulated for payments made on Saturday, Sunday, Monday, and/or Tuesday by the following Friday. Penalty for filing taxes late Semiweekly depositors are not required to deposit twice a week if their payments were in the same semiweekly period unless the $100,000 Next-Day Deposit Rule (discussed later in this section) applies. Penalty for filing taxes late For example, if you made a payment on both Wednesday and Friday and incurred taxes of $10,000 for each pay date, deposit the $20,000 by the following Wednesday. Penalty for filing taxes late If you made no additional payments on Saturday through Tuesday, no deposit is due on Friday. Penalty for filing taxes late Semiweekly schedule depositors must complete Form 943-A, Agricultural Employer's Record of Federal Tax Liability, and submit it with Form 943. Penalty for filing taxes late Semiweekly Deposit Schedule IF the payday falls on a. Penalty for filing taxes late . Penalty for filing taxes late . Penalty for filing taxes late THEN deposit taxes by the following. Penalty for filing taxes late . Penalty for filing taxes late . Penalty for filing taxes late Wednesday, Thursday, and/or Friday Wednesday Saturday, Sunday, Monday, and/or Tuesday Friday Semiweekly schedule example. Penalty for filing taxes late   Green, Inc. Penalty for filing taxes late , is a semiweekly schedule depositor and pays wages once each month on the last Friday of the month. Penalty for filing taxes late Green, Inc. Penalty for filing taxes late , will deposit only once a month, but the deposit will be made under the semiweekly deposit schedule as follows. Penalty for filing taxes late Green, Inc. Penalty for filing taxes late 's tax liability for the April 25, 2014 (Friday), wage payment must be deposited by April 30, 2014 (Wednesday). Penalty for filing taxes late Semiweekly deposit period spanning two quarters. Penalty for filing taxes late   If you have more than one pay date during a semiweekly period and the pay dates fall in different calendar quarters, you will need to make separate deposits for the separate liabilities. Penalty for filing taxes late For example, if you have a pay date on Monday, March 31, 2014 (first quarter), and another pay date on Tuesday, April 1, 2014 (second quarter), two separate deposits will be required even though the pay dates fall within the same semiweekly period. Penalty for filing taxes late Both deposits will be due Friday, April 4, 2014 (3 business days from the end of the semiweekly deposit period). Penalty for filing taxes late Deposits on Business Days Only If a deposit is required to be made on a day that is not a business day, the deposit is considered timely if it is made by the close of the next business day. Penalty for filing taxes late A business day is any day other than a Saturday, Sunday, or legal holiday. Penalty for filing taxes late For example, if a deposit is required to be made on Friday and Friday is a legal holiday, the deposit is considered timely if it is made by the following Monday (if Monday is a business day). Penalty for filing taxes late Semiweekly schedule depositors   will always have 3 business days to make a deposit. Penalty for filing taxes late That is, if any of the 3 weekdays after the end of a semiweekly period is a legal holiday, you will have an additional day for each day that is a legal holiday to make the deposit. Penalty for filing taxes late For example, if a semiweekly schedule depositor accumulated taxes on Friday and the following Monday is a legal holiday, the deposit normally due on Wednesday may be made on Thursday (this allows 3 business days to make the deposit). Penalty for filing taxes late Legal holiday. Penalty for filing taxes late   The term “legal holiday” means any legal holiday in the District of Columbia. Penalty for filing taxes late Legal holidays for 2014 are listed below. Penalty for filing taxes late January 1— New Year's Day January 20— Birthday of Martin Luther King, Jr. Penalty for filing taxes late February 17— Washington's Birthday April 16— District of Columbia Emancipation Day May 26— Memorial Day July 4— Independence Day September 1— Labor Day October 13— Columbus Day November 11— Veterans' Day November 27— Thanksgiving Day December 25— Christmas Day $100,000 Next-Day Deposit Rule If you accumulate $100,000 or more of Form 943 taxes (that is, taxes reported on Form 943, line 11) on any day during a deposit period, you must deposit the tax by the close of the next business day, whether you are a monthly or a semiweekly schedule depositor. Penalty for filing taxes late For purposes of the $100,000 rule, do not continue accumulating a tax liability after the end of a deposit period. Penalty for filing taxes late For example, if a semiweekly schedule depositor has accumulated a liability of $95,000 on a Tuesday (of a Saturday-through-Tuesday deposit period) and accumulated a $10,000 liability on Wednesday, the $100,000 next-day deposit rule does not apply because the $10,000 is accumulated in the next deposit period. Penalty for filing taxes late Thus, $95,000 must be deposited by Friday and $10,000 must be deposited by the following Wednesday. Penalty for filing taxes late However, once you accumulate at least $100,000 in a deposit period, stop accumulating at the end of that day and begin to accumulate anew on the next day. Penalty for filing taxes late For example, Fir Co. Penalty for filing taxes late is a semiweekly schedule depositor. Penalty for filing taxes late On Monday, Fir Co. Penalty for filing taxes late accumulates taxes of $110,000 and must deposit this amount on Tuesday, the next business day. Penalty for filing taxes late On Tuesday, Fir Co. Penalty for filing taxes late accumulates additional taxes of $30,000. Penalty for filing taxes late Because the $30,000 is not added to the previous $110,000 and is less than $100,000, Fir Co. Penalty for filing taxes late does not have to deposit the $30,000 until Friday (following the semiweekly deposit schedule). Penalty for filing taxes late If you are a monthly schedule depositor and you accumulate a $100,000 tax liability on any day, you become a semiweekly schedule depositor on the next day and remain so for at least the rest of the calendar year and for the following calendar year. Penalty for filing taxes late Example of the $100,000 next-day deposit rule. Penalty for filing taxes late   Elm, Inc. Penalty for filing taxes late , started its business on May 1, 2014. Penalty for filing taxes late Because Elm, Inc. Penalty for filing taxes late , is a new employer, the taxes for its lookback period are considered to be zero; therefore, Elm, Inc. Penalty for filing taxes late , is a monthly schedule depositor. Penalty for filing taxes late On May 8, Elm, Inc. Penalty for filing taxes late , paid wages for the first time and accumulated taxes of $50,000. Penalty for filing taxes late On May 9 (Friday), Elm, Inc. Penalty for filing taxes late , paid wages and accumulated taxes of $60,000, for a total of $110,000. Penalty for filing taxes late Because Elm, Inc. Penalty for filing taxes late , accumulated $110,000 on May 9, it must deposit $110,000 by May 12 (Monday), the next business day. Penalty for filing taxes late Elm, Inc. Penalty for filing taxes late , became a semiweekly schedule depositor on May 10. Penalty for filing taxes late It will be a semiweekly schedule depositor for the remainder of 2014 and for 2015. Penalty for filing taxes late Accuracy of Deposits Rule You are required to deposit 100% of your tax liability on or before the deposit due date. Penalty for filing taxes late However, penalties will not be applied for depositing less than 100% if both of the following conditions are met. Penalty for filing taxes late Any deposit shortfall does not exceed the greater of $100 or 2% of the amount of taxes otherwise required to be deposited. Penalty for filing taxes late The deposit shortfall is paid or deposited by the shortfall makeup date as described below. Penalty for filing taxes late Makeup Date for Deposit Shortfall:    Monthly Schedule Depositor—Deposit the shortfall or pay it with your return by the due date of your Form 943. Penalty for filing taxes late You may pay the shortfall with your Form 943 even if the amount is $2,500 or more. Penalty for filing taxes late Semiweekly Schedule Depositor—Deposit by the earlier of (a) the first Wednesday or Friday (whichever comes first) that falls on or after the 15th of the month following the month in which the shortfall occurred, or (b) the due date for Form 943. Penalty for filing taxes late For example, if a semiweekly schedule depositor has a deposit shortfall during February 2014, the shortfall makeup date is March 19, 2014 (Wednesday). Penalty for filing taxes late How To Deposit You must deposit employment taxes by electronic funds transfer. Penalty for filing taxes late See Payment with return , earlier in this section, for exceptions explaining when taxes may be paid with the tax return instead of being deposited. Penalty for filing taxes late Electronic deposit requirement. Penalty for filing taxes late   You must use electronic funds transfer to make all federal tax deposits (such as deposits of employment tax, excise tax, and corporate income tax). Penalty for filing taxes late Generally, electronic funds transfers are made using the Electronic Federal Tax Payment System (EFTPS). Penalty for filing taxes late If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. Penalty for filing taxes late   EFTPS is a free service provided by the Department of Treasury. Penalty for filing taxes late To get more information or to enroll in EFTPS, call 1-800-555-4477 (business), 1-800-316-6541 (individual), or 1-800-733-4829 (TDD). Penalty for filing taxes late You can also visit the EFTPS website at www. Penalty for filing taxes late eftps. Penalty for filing taxes late gov. Penalty for filing taxes late Additional information about EFTPS is also available in Publication 966. Penalty for filing taxes late New employers that have a federal tax obligation will be pre-enrolled in EFTPS. Penalty for filing taxes late Call the toll-free number located in your Employer Identification Number (EIN) Package to activate your enrollment and begin making your tax deposit payments. Penalty for filing taxes late See When you receive your EIN in section 1 for more information. Penalty for filing taxes late Deposit record. Penalty for filing taxes late   For your records, an Electronic Funds Transfer (EFT) Trace Number will be provided with each successful payment. Penalty for filing taxes late The number can be used as a receipt or to trace the payment. Penalty for filing taxes late Depositing on time. Penalty for filing taxes late   For deposits made by EFTPS to be on time, you must initiate the deposit by 8 p. Penalty for filing taxes late m. Penalty for filing taxes late Eastern time the day before the date a deposit is due. Penalty for filing taxes late If you use a third party to make a deposit on your behalf, they may have different cutoff times. Penalty for filing taxes late Same-day payment option. Penalty for filing taxes late   If you fail to initiate a deposit transaction on EFTPS by 8 p. Penalty for filing taxes late m. Penalty for filing taxes late Eastern time the day before the date a deposit is due, you can still make your deposit on time by using the Federal Tax Application (FTA). Penalty for filing taxes late To use the same-day payment method, you will need to make arrangements with your financial institution ahead of time. Penalty for filing taxes late Please check with your financial institution regarding availability, deadlines, and costs. Penalty for filing taxes late Your financial institution may charge you a fee for payments made this way. Penalty for filing taxes late To learn more about the information you will need to provide to your financial institution to make a same-day wire payment, visit www. Penalty for filing taxes late eftps. Penalty for filing taxes late gov to download the Same-Day Payment Worksheet. Penalty for filing taxes late Deposit Penalties Penalties may apply if you do not make required deposits on time or if you make deposits for less than the required amount. Penalty for filing taxes late The penalties do not apply if any failure to make a proper and timely deposit was due to reasonable cause and not to willful neglect. Penalty for filing taxes late IRS may also waive deposit penalties if you inadvertently fail to deposit in the first quarter that a deposit is due, or the first quarter during which your frequency of deposits changed, if you timely filed your employment tax return. Penalty for filing taxes late For amounts not properly deposited or not deposited on time, the penalty rates are shown next. Penalty for filing taxes late Penalty Charged for. Penalty for filing taxes late . Penalty for filing taxes late . Penalty for filing taxes late 2% Deposits made 1 to 5 days late. Penalty for filing taxes late 5% Deposits made 6 to 15 days late. Penalty for filing taxes late 10% Deposits made 16 or more days late. Penalty for filing taxes late Also applies to amounts paid within 10 days of the date of the first notice the IRS sent asking for the tax due. Penalty for filing taxes late 10% Amounts (that should have been deposited) paid directly to the IRS or paid with your tax return. Penalty for filing taxes late See Payment with return , earlier in this section, for exceptions. Penalty for filing taxes late 15% Amounts still unpaid more than 10 days after the date of the first notice that the IRS sent asking for the tax due or the day on which you received notice and demand for immediate payment, whichever is earlier. Penalty for filing taxes late Late deposit penalty amounts are determined using calendar days, starting from the due date of the liability. Penalty for filing taxes late Order in which deposits are applied. Penalty for filing taxes late   Deposits generally are applied to the most recent tax liability within the year. Penalty for filing taxes late If you receive a failure-to-deposit penalty notice, you may designate how your deposits are to be applied in order to minimize the amount of the penalty, if you do so within 90 days of the date of the notice. Penalty for filing taxes late Follow the instructions on the penalty notice that you received. Penalty for filing taxes late For examples on how the IRS will apply deposits and more information on designating deposits, see Revenue Procedure 2001-58. Penalty for filing taxes late You can find Revenue Procedure 2001-58 on page 579 of Internal Revenue Bulletin 2001-50 at www. Penalty for filing taxes late irs. Penalty for filing taxes late gov/pub/irs-irbs/irb01-50. Penalty for filing taxes late pdf. Penalty for filing taxes late Example. Penalty for filing taxes late Cedar, Inc. Penalty for filing taxes late , is required to make a deposit of $1,000 on July 15 and $1,500 on August 15. Penalty for filing taxes late It does not make the deposit on July 15. Penalty for filing taxes late On August 15, Cedar, Inc. Penalty for filing taxes late , deposits $2,000. Penalty for filing taxes late Under the deposits rule, which applies deposits to the most recent tax liability, $1,500 of the deposit is applied to the August 15 deposit and the remaining $500 is applied to the July deposit. Penalty for filing taxes late Accordingly, $500 of the July 15 liability remains undeposited. Penalty for filing taxes late The penalty on this underdeposit will apply as explained above. Penalty for filing taxes late Trust fund recovery penalty. Penalty for filing taxes late   If federal income, social security, or Medicare taxes that must be withheld are not withheld or are not deposited or paid to the United States Treasury, the trust fund recovery penalty may apply. Penalty for filing taxes late The penalty is the full amount of the unpaid trust fund tax. Penalty for filing taxes late This penalty may apply to you if these unpaid taxes cannot be immediately collected from the employer or business. Penalty for filing taxes late   The trust fund recovery penalty may be imposed on all persons who are determined by the IRS to be responsible for collecting, accounting for, and paying over these taxes, and who acted willfully in not doing so. Penalty for filing taxes late   A responsible person can be an officer or employee of a corporation, a partner or employee of a partnership, an accountant, a volunteer director/trustee, or an employee of a sole proprietorship. Penalty for filing taxes late A responsible person also may include one who signs checks for the business or otherwise has authority to cause the spending of business funds. Penalty for filing taxes late    Willfully means voluntarily, consciously, and intentionally. Penalty for filing taxes late A responsible person acts willfully if the person knows that the required actions of collecting, accounting for or paying over trust fund taxes are not taking place, or recklessly disregards obvious and known risks to the government's right to receive trust fund taxes. Penalty for filing taxes late “Average” failure-to-deposit penalty. Penalty for filing taxes late   IRS may assess an “averaged” failure-to-deposit penalty of 2% to 10% if you are a monthly schedule depositor and did not properly complete Form 943, line 17, when your tax liability shown on Form 943, line 11, was $2,500 or more. Penalty for filing taxes late IRS may also assess this penalty of 2% to 10% if you are a semiweekly schedule depositor and your tax liability shown on Form 943, line 11, was $2,500 or more and you did any of the following. Penalty for filing taxes late Completed Form 943, line 17, instead of Form 943-A. Penalty for filing taxes late Failed to attach a properly completed Form 943-A. Penalty for filing taxes late Completed Form 943-A incorrectly, for example, by entering tax deposits instead of tax liabilities in the numbered spaces. Penalty for filing taxes late   IRS figures the penalty by allocating your tax liability on Form 943, line 11, equally throughout the tax period. Penalty for filing taxes late Your deposits and payments may not be counted as timely because IRS does not know the actual dates of your tax liabilities. Penalty for filing taxes late   You can avoid the penalty by reviewing your return before filing it. Penalty for filing taxes late Follow these steps before filing your Form 943. Penalty for filing taxes late If you are a monthly schedule depositor, report your tax liabilities (not your deposits) in the monthly entry spaces on Form 943, line 17. Penalty for filing taxes late If you are a semiweekly schedule depositor, report your tax liabilities (not your deposits) on Form 943-A in the lines that represent the dates you paid your employees. Penalty for filing taxes late Verify that your total liability shown on Form 943, line 17, or Form 943-A, line M, equals your tax liability shown on Form 943, line 11. Penalty for filing taxes late Do not show negative amounts on Form 943, line 17, or Form 943-A. Penalty for filing taxes late For prior period errors discovered after December 31, 2008, do not adjust your tax liabilities reported on Form 943, line 17, or on Form 943-A. Penalty for filing taxes late Employers of Both Farm and Nonfarm Workers If you employ both farm and nonfarm workers, you must treat employment taxes for the farmworkers (Form 943 taxes) separately from employment taxes for the nonfarm workers (Form 941 and 944 taxes). Penalty for filing taxes late Form 943 taxes and Form 941/944 taxes are not combined for purposes of applying any of the deposit schedule rules. Penalty for filing taxes late If a deposit is due, deposi