Publication 80 - Circular Ss - Department Of The Treasury (Page 8 of 24) in pdf

the $2,500 test or the $150 test explained in section 6 has

When To Deposit

been met.

Note: Under the rules discussed below, the only differ-

ence between farm and nonfarm workers’ employment tax

Employee’s portion of taxes paid by employer. If you

deposit rules is the lookback period. Therefore, farm and

pay your employee’s social security and Medicare taxes

nonfarm workers are discussed together except where

without deducting them from the employee’s pay, you must

noted.

include the amount of the payments in the employee’s

Depending on your total taxes reported during a look-

wages for social security and Medicare taxes. This in-

back period (discussed below), you are either a monthly

crease in the employee’s wage payment for your payment

schedule depositor or a semiweekly schedule deposi-

of the employee’s social security and Medicare taxes is

tor.

also subject to employee social security and Medicare

The terms “monthly schedule depositor” and “semi-

taxes. This again increases the amount of the additional

weekly schedule depositor” do not refer to how often you

taxes that you must pay.

pay your employees or how often you are required to make

deposits. The terms identify which set of rules that you

Note: This discussion does not apply to household and

must follow when a tax liability arises (e.g., when you have

agricultural employers. If you pay a household or agricul-

a payday).

tural employee’s social security and Medicare taxes, these

You will need to determine your deposit schedule for a

payments must be included in the employee’s wages.

calendar year based on the total employment taxes re-

ported on line 10 of Form 941-SS, line 11 of Form 941, or

However, this wage increase due to the tax payments is

line 9 of Form 943 for your lookback period (defined be-

not subject to social security or Medicare taxes as dis-

low). If you filed both Forms 941-SS and 941 during the

cussed in this section. See Publication 15-A for details.

lookback period, combine the tax liabilities for these re-

turns for purposes of determining your deposit schedule.

Sick pay payments. Social security and Medicare taxes

Determine your deposit schedule for Form 943 separately

apply to most payments of sick pay, including payments

from Forms 941-SS and 941.

made by third parties such as insurance companies. For

details on third-party payers of sick pay, see

Lookback period for employers of nonfarm workers.

The lookback period for Form 941-SS (or Form 941) con-

Pub. 15-A.

sists of four quarters beginning July 1 of the second pre-

ceding year and ending June 30 of the prior year. These

four quarters are your lookback period even if you did not

8. Deposit Requirements

report any taxes for any of the quarters. For 2004, the

lookback period is July 1, 2002, through June 30, 2003.

You must deposit social security and Medicare taxes if

Lookback Period for Calendar Year 2004

your tax liability (line 10 of Form 941-SS or line 11 of Form

943) is $2,500 or more for the tax return period. You make

Lookback Period

the deposits either electronically or with paper coupons.

2002

2003

2004

These methods are discussed later.

July 1

Oct. 1

Jan. 1

Apr. 1

Calendar

↓

Year

Payment with Return

Sept.

Dec.

Mar. 31

June 30

Jan.–Dec.

You may make a payment with Form 941-SS or 943

instead of depositing if:

•

You accumulate less than a $2,500 tax liability dur-

ing the return period (line 10 of Form 941-SS or line

Lookback period for employers of farmworkers. The

11 of Form 943) and you pay in full with a timely filed

lookback period for Form 943 is the second calendar year

return. However, if you are unsure that you will accu-

preceding the current calendar year. The lookback period

mulate less than $2,500, deposit under the rules

for calendar year 2004 is calendar year 2002.

explained in this section so that you will not be sub-

Adjustments to lookback period taxes. To determine

ject to failure to deposit penalties, or

your taxes for the lookback period, use only the tax that

•

You are a monthly schedule depositor and make

you reported on the original returns (Forms 941-SS, 941,

a payment in accordance with the Accuracy of De-

or 943). Do not include adjustments made on a supple-

posits Rule on page 10. This payment may be

mental return filed after the due date of the return. How-

$2,500 or more.

ever, if you make adjustments on Form 941-SS or 943, the

adjustments are included in the total tax for the period in

which the adjustments are reported.

Only monthly schedule depositors are allowed

to make an Accuracy of Deposits Rule payment

Example of adjustments. An employer originally re-

with the return.

CAUTION

ported total taxes of $45,000 for the lookback period. The

Page 8

Publication 80 - Circular Ss - Department Of The Treasury Page 8

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