Publication 80 - Federal Tax Guide (Circular Ss) - Internal Revenue Service - 2012 Page 16
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25In most cases, farmworkers supplied by a crew leader
11. Federal Unemployment
are considered employees of the farm operator for FUTA
tax purposes. However, this is not the case if either of the
(FUTA) Tax—U.S. Virgin
following applies and the crew leader is not an employee of
Islands Employers Only
the farm operator.
1. The crew leader is registered under the Migrant and
The Federal Unemployment Tax Act (FUTA), with state
Seasonal Agricultural Worker Protection Act.
unemployment systems, provides for payments of unem-
2. Substantially all of the workers supplied by the crew
ployment compensation to workers who have lost their
leader operate or maintain tractors, harvesting or
jobs. Most employers pay both a federal and a state unem-
cropdusting machines, or other machines provided
ployment tax. Only the employer pays FUTA tax; it is not
by the crew leader.
withheld from your employees’ wages. For more informa-
tion, see the Instructions for Form 940.
If (1) or (2) applies, the farmworkers are generally em-
You must file Form 940, Employer’s Annual Federal
ployees of the crew leader.
Unemployment (FUTA) Tax Return, if you are subject to
FUTA tax under the following rules.
Computing FUTA rate. For 2012, the FUTA tax rate is
In general. You are subject to FUTA tax in 2012 on the
6.0%. The tax applies to the first $7,000 you pay to each
wages you pay employees who are not farmworkers or
employee as wages during the year. Generally, you may
household workers if:
take a credit of 5.4% against the FUTA tax for payments to
U.S. Virgin Islands unemployment funds. Therefore, your
1. You paid wages of $1,500 or more in any calendar
actual tax rate is usually 0.6% (6.0% − 5.4%) for wages
quarter of 2011 or 2012, or
paid in 2012. However, your credit is reduced if you did not
2. You had one or more employees for at least some
pay all required U.S. Virgin Islands unemployment tax by
part of a day in any 20 or more different weeks in
the due date of Form 940 or if all your FUTA wages are not
2011 or 20 or more different weeks in 2012.
subject to U.S. Virgin Islands unemployment tax. The
credit cannot be more than 5.4% of taxable FUTA wages.
Household workers. You are subject to FUTA tax only if
you paid total cash wages of $1,000 or more (for all
Form 940. By January 31, 2012, file Form 940. If you
household workers) in any calendar quarter in 2011 or
made all FUTA tax deposits on time, you may file Form 940
2012.
by February 10, 2012.
Farmworkers. You are subject to FUTA tax on the wages
that you pay to farmworkers in 2012 if:
Deposits. For deposit purposes, figure FUTA tax quar-
•
You paid total cash wages of $20,000 or more for
terly. Determine your FUTA tax liability by multiplying the
the farmwork in any calendar quarter to farmworkers
amount of taxable wages paid during the quarter by 0.6%.
during 2011 or 2012, or
Stop depositing FUTA tax on an employee’s wages when
he or she reaches $7,000 in taxable wages for the calen-
•
You employed 10 or more farmworkers during at
dar year. If your FUTA tax liability for any calendar quarter
least some part of a day (whether or not at the same
is $500 or less, you do not have to deposit the tax. Instead,
time) during any 20 or more different weeks in 2011
you may carry it forward and add it to the liability figured in
or 20 or more different weeks in 2012.
the next quarter to see if you must make a deposit. If your
FUTA tax liability for any calendar quarter is over $500
To determine whether you meet either test above, you
(including any FUTA tax carried forward from an earlier
must count wages paid to aliens admitted on a temporary
quarter), you must deposit the tax by electronic funds
basis to the United States to perform farmwork, also known
transfer. See
section 8
for more information on deposits.
as “H-2(A)” visa workers. However, wages paid to “H-2(A)”
visa workers are not subject to the FUTA tax.
Page 16
Publication 80 (2012)
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