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Fractions of cents. If there is a difference between the

first $79,200 of the employee’s compensation for 2010 is

subject to this tax. Multiply by 3.9% and enter the result in

total employee tax (lines 4, 5, 6, 9, and 10) and the total

the Tax column. For information on reporting tips, see Tips

actually deducted (employee compensation including tips

on page 3.

plus the employer’s contribution) due to rounding fractions of

cents when collecting the tax, report the deduction or

Any compensation paid during the current year that

addition on line 12.

was earned in prior years (reported to the Railroad

Retirement Board on Form BA-4, Report of

If this is the only entry on line 12, you are not

CAUTION

Creditable Compensation Adjustments) is taxable at the

required to attach a statement explaining the

TIP

current year tax rates, unless special timing rules for

adjustment.

nonqualified deferred compensation apply. See Publication

15-A. Include such compensation with current year

Line 13—Total Railroad Retirement

compensation on lines 1a through 6, as appropriate.

Taxes Based on Compensation

Lines 7a Through 10—Tier I Taxes on

Combine the amounts shown on lines 11 and 12 and enter

Sick Pay

the result on line 13.

7a. Enter any sick pay payments during the year that are

Line 14—Total Deposits for the Year

subject to Tier I taxes and Tier I Medicare taxes in the

Enter the total Form CT-1 taxes you deposited. Also, include

Compensation column.

any overpayment applied from your 2009 Form CT-1 and

7c. Enter the amount of exempt sick pay subject to Tier I

from Form CT-1 X.

employer tax paid to qualified employees after March 31,

2010. Multiply by 6.2% and enter on the result on line 7d.

Line 15—Credit for Exempt Taxes

7e. Subtract line 7b from line 7d and enter the result on line

Paid First Quarter

7e.

If you are a railroad employer paying your employees

15a. Enter the number of qualified employees paid exempt

sick pay, or a third-party payer who did not notify the

compensation (including sick pay) from March 19 through

employer of the payments (thereby subject to the employee

31. See line 1c for definitions of qualified employees and

and employer tax), make entries on lines 7a through 10. If

exempt compensation.

you are subject to only the employer or employee tax,

15b. Enter the exempt compensation (other than tips) paid

complete only the applicable lines. Multiply by the

to qualified employees from March 19 through 31 in the

appropriate rates and enter the results in the

Compensation column. Multiply exempt compensation by

Tax column.

6.2% and enter the result on line 15c.

Line 12—Adjustments to Taxes

Line 16—Total Taxes

Based on Compensation

Add lines 14 and 15c and enter the result on line 16.

Do not use line 12 for prior period adjustments. Make

Line 17— Balance Due

all prior period adjustments on Form CT-1 X.

Subtract line 16 from line 13. You should have a balance

CAUTION

due only if line 13 is less than $2,500, unless the balance

Enter on line 12:

•

due is a shortfall amount for monthly schedule depositors as

A fractions of cents adjustment (see Fractions of cents

explained under the Accuracy of Deposits Rule on page 4.

below);

•

Credits for overpayments of penalty or interest paid on tax

Form CT-1(V), Payment Voucher, has instructions for

for earlier years; and

making a payment with Form CT-1. You do not have to pay

•

Any uncollected Tier I Employee tax, Tier I Employee

if line 17 is less than $1.

Medicare tax, and Tier II Employee tax on tips.

Line 18— Overpayment

Enter the total of these adjustments in the Tax column. If

you are reporting both an addition and a subtraction, enter

Enter the overpayment on the designated entry line. Then

only the difference between the two on line 12. If the net

check the appropriate box to have the overpayment applied

adjustment is negative, report the amount on line 12 using a

to your 2011 Form CT-1 or refunded to you. If line 18 is less

minus sign, if possible. If your computer software does not

than $1, we will send you a refund or apply it to your next

allow the use of minus signs, you may use parentheses.

return only on written request.

Do not include on line 12 the 2009 overpayment that is

applied to this year’s return (this is included on line 14).

Third-Party Designee

Required statement. Except for adjustments for fractions

If you want to allow an employee of your business, a return

of cents, explain amounts entered on line 12 in a separate

preparer, or another third party to discuss your 2010

statement. Include your name, employer identification

Form CT-1 with the IRS, check the “Yes” box in the

number (EIN), calendar year of the return, and “Form CT-1”

Third-Party Designee section of Form CT-1. Also, enter the

on each page you attach. Include in the statement the

designee’s name, phone number, and any five digits that

following information.

person chooses as his or her personal identification number

•

An explanation of the item the adjustment is intended to

(PIN).

correct showing the compensation subject to Tier I and

Tier II taxes and their respective tax rates.

By checking the “Yes” box, you are authorizing the IRS to

•

The amount of the adjustment.

speak with the designee to answer any questions relating to

•

The name and account number of any employee from

the processing of or the information reported on Form CT-1.

whom employee tax was undercollected or overcollected.

You are also authorizing the designee to:

•

How you and the employee have settled any

Exchange information concerning Form CT-1 with the

undercollection or overcollection of employee tax.

IRS, and

-6-

Instructions for Form CT-1 (2010)

Instructions For Form Ct-1 - Employer'S Annual Railroad Retirement Tax Return - 2010 Page 6

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