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Example — Federal income tax withheld increased: You

If you checked the box on line 2, you are filing a claim for

reported $9,000 as federal income tax withheld on line 1 of your

refund or abatement of the amount shown.

2009 Form 945. In July of 2010, you discovered that you had

If your credit is less than $1, we will send a refund or apply it

overlooked $1,000 in federal income tax actually withheld from

only if you ask us in writing to do so.

one of your payees. To correct the error, figure the difference

on Form 945-X as shown.

Amount you owe. You must pay the amount you owe when

you file Form 945-X. You may not use any credit that you show

Column 1 (corrected amount)

10,000.00

on another Form 945-X to pay for the amount you owe, even if

Column 2 (from line 1 of Form 945)

9,000.00

you filed for the amount you owe and the credit at the same

Column 3 (difference)

1,000.00

time. You may pay the amount you owe on line 5 electronically

Example — Federal income tax withheld decreased:

using the Electronic Federal Tax Payment System (EFTPS), by

You reported $9,600 as federal income tax withheld on line 1 of

credit or debit card, or by check or money order.

your 2009 Form 945. In December of 2010, you discovered that

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The preferred method of payment is EFTPS. For information,

you actually withheld $6,900 but reported the higher amount

visit

or call EFTPS Customer Service at

due to a typographical (administrative) error. To correct the

1-800-555-4477 toll free, or get Pub. 966, The Secure Way to

error, figure the difference on Form 945-X as shown.

Pay Your Federal Taxes.

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For more information on paying by credit or debit card, visit

Column 1 (corrected amount)

6,900.00

the IRS website at

Column 2 (from line 1 of Form 945)

9,600.00

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If you pay by check or money order, make it payable to

Column 3 (difference)

-2,700.00

“United States Treasury.” On your check or money order, be

Example — Failure to withhold income tax when

sure to write your EIN, “Form 945-X,” and the year corrected.

required: You were required to withhold $400 of federal

You do not have to pay if the amount you owe is less than

income tax from a new payee in December of 2009 but withheld

nothing. You discovered the error on March 15, 2010. You

$1.

cannot file Form 945-X to correct your 2009 Form 945 because

Previously assessed FTD penalty. If line 5 reflects

the error involves a previous year and the amount previously

overreported tax and the IRS previously assessed a

reported for the new payee (zero) represents the actual amount

failure-to-deposit (FTD) penalty, you may be able to reduce the

withheld from the new payee during 2009.

penalty. For more information, see the instructions for Form

Example — Administrative error: You had three payees.

945-A.

In 2009, you withheld $1,000 of federal income tax from payee

A, $2,000 from payee B, and $6,000 from payee C. The total

Part 3: Explain Your Corrections for This

amount of federal income tax you withheld was $9,000. You

Year

mistakenly reported $6,000 on line 1 of your 2009 Form 945.

You discovered the error on March 16, 2010. This is an

example of an administrative error that may be corrected in a

6. Correcting Both Underreported and

later calendar year because the amount actually withheld from

Overreported Amounts

payees differs from the amount reported on Form 945. Use

Form 945-X to correct the error. Enter $9,000 in column 1 of

Check the box on line 6 if any corrections you entered on line 3

line 3 and $6,000 in column 2 of line 3. Subtract the amount in

or line 4 in column 3 reflect both underreported and

column 2 from the amount in column 1.

overreported amounts.

Example: If you had an increase to withheld income tax of

Column 1 (corrected amount)

9,000.00

Column 2 (from line 1 of Form 945)

- 6,000.00

$15,000 for payee A and a decrease to withheld income tax of

Column 3 (difference)

3,000.00

$5,000 for payee B, you would enter $10,000 on line 3, column

3. That $10,000 represents the net change from corrections.

Be sure to explain the reasons for this correction on line 7.

On line 7, you must explain the reason for both the $15,000

4. Backup Withholding

increase and the $5,000 decrease.

If you are correcting the backup withholding of federal income

7. Explain Your Corrections

tax you reported on line 2 of Form 945, enter the total corrected

Treasury regulations require you to explain in detail the grounds

amount in column 1. In column 2, enter the amount you

and facts relied upon to support each correction. On line 7,

originally reported or as previously corrected. In column 3, enter

describe in detail each correction you entered in column 3 on

the difference between columns 1 and 2.

lines 3 and 4. If you need more space, attach additional sheets,

but be sure to write your name, EIN, Form 945-X, and calendar

line 4 (column 1)

-line 4 (column 2)

year on the top of each sheet.

line 4 (column 3)

If the amount in column 2 is larger than the

You must describe the events that caused the underreported

amount in column 1, use a minus sign in

or overreported withheld income tax or backup withholding. An

column 3.

explanation such as “withheld income tax was overstated” is

insufficient and may delay processing your Form 945-X

Read the instructions for line 3 for more information on

because the IRS may need to ask for a more complete

completing line 4. For correction purposes, there is no

TIP

explanation.

distinction between federal income tax withheld from

pensions, annuities, IRAs, gambling winnings, etc. and backup

Provide the following information in your explanation for

withholding.

each error you are correcting.

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Form 945-X line number(s) affected.

5. Total

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Date you discovered the error.

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Combine the amounts from lines 3 and 4 of column 3. Enter the

Difference (amount of the error).

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result on line 5.

Cause of the error.

Your credit. If the amount entered on line 5 is less than zero,

You may report the information in paragraph form. The

for example, “-115.00,” you have a credit because you

following paragraph is an example.

overreported your withheld federal income tax.

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If you checked the box on line 1, include this amount on line

“The $1,000 difference shown in column 3 of line 3 was

4 (“Total deposits”) of Form 945 for the year during which you

discovered on May 15, 2010, during an internal audit. Due to a

file Form 945-X. Do not make changes to your Monthly

typographical error, we reported $11,000 as withheld income

Summary of Federal Tax Liability on Form 945 or on Form

tax on Form 945 instead of the $10,000 actually withheld from

945-A. The amounts reported on the record should reflect your

payees. This correction removes the $1,000 that was

actual tax liability for the period.

overreported.”

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Instructions for Form 945-X

Form 945-X - Instructions For Adjusted Annual Return Of Withheld Federal Income Tax Or Claim For Refund - Department Of The Treasury - 2011 Page 4

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