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Lines 7 Through 10. Tier I Taxes on

Line 13. Total Railroad Retirement Taxes

Sick Pay

Based on Compensation

Enter any sick pay payments during the year that are subject to

If the net adjustment on line 12 is:

•

Tier I taxes and Tier I Medicare taxes in the Compensation

A decrease, subtract line 12 from line 11.

•

column. If you are a railroad employer paying your employees

An increase, add line 12 to line 11.

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

Line 14. Total Deposits for the Year

of the payments (thereby subject to the employee and employer

tax), make entries on lines 7 through 10. If you are subject to

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

only the employer or employee tax, complete only the

any overpayment applied from your 2002 Form CT-1.

applicable lines. Multiply by the appropriate rates and enter the

results in the Tax column.

Line 15. Balance Due

Subtract line 14 from line 13. You should have a balance due

Line 12. Adjustments to Taxes Based on

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

Compensation

shortfall amount for monthly schedule depositors as explained

under the Accuracy of deposits rule on page 4.

Enter on line 12:

•

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

A sick pay adjustment,

•

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

A fractions of cents adjustment (see Fractions of cents

line 15 is less than $1.

below),

•

Corrections of underpayments or overpayments of taxes

Line 16. Overpayment

reported on prior year returns, including any adjustments

resulting from an audit by the RRB, and

Enter the overpayment on the designated entry line. Then

•

Credits for overpayments of penalty or interest paid on tax for

check the appropriate box to have the overpayment applied to

earlier years.

your 2004 Form CT-1 or refunded to you. If line 16 is less than

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

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

are reporting both an addition and a subtraction, enter only the

on written request.

difference between the two on line 12.

Third Party Designee

Do not include on line 12 the 2002 overpayment that is

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

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

Required statement. Except for adjustments for fractions of

preparer, or other third party to discuss your 2003 Form CT-1

cents, explain amounts entered on line 12 in a separate

with the IRS, check the “Yes” box in the Third Party Designee

statement. Include your name, employer identification number,

section of Form CT-1. Also, enter the designee’s name, phone

calendar year of the return, and “Form CT-1” on each page you

number, and any five digits that person chooses as his or her

attach. Include in the statement the following information:

personal identification number (PIN).

•

An explanation of the item the adjustment is intended to

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

correct showing the compensation subject to Tier I and Tier II

call the designee to answer any questions relating to the

taxes and the respective tax rates.

information reported on Form CT-1. You are also authorizing

•

The year(s) to which the adjustment relates.

the designee to:

•

The amount of the adjustment for each year.

Exchange information concerning Form CT-1 with the IRS

•

The name and account number of any employee from whom

and

•

employee tax was undercollected or overcollected.

Request and receive written tax return information relating to

•

How you and the employee have settled any undercollection

Form CT-1, including copies of notices, correspondence, and

or overcollection of employee tax.

account transcripts.

You are not authorizing the designee to receive any refund

A timely filed return is considered to be filed on the last

check, bind you to anything (including additional tax liability), or

TIP

day of February of the year after the close of the tax

otherwise represent you before the IRS. If you want to expand

year. Generally, adjustments for prior year returns may

the designee’s authority or would like the designee to receive

be made only within 3 years of that date.

copies of notices and communications, see Pub. 947, Practice

Fractions of cents. If there is a difference between the total

Before the IRS and Power of Attorney.

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

The authorization will automatically expire one year from the

deducted (employee compensation including tips plus the

due date (without regard to extensions) for filing your 2003

employer’s contribution) due to rounding fractions of cents

Form CT-1. If you or your designee wants to revoke this

when collecting the tax, report the deduction or addition on

authorization, send a written statement of revocation to the

line 12.

Internal Revenue Service Center, Cincinnati, OH 45999. See

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

Pub. 947 for more information.

TIP

attach a statement explaining the adjustment.

-5-

Instructions For Form Ct-1 - Employer'S Annual Railroad Retirement Tax Return - 2003 Page 5

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