The IRS has released deposit requirements for employment taxes. There are two deposit schedules—monthly or semiweekly—for determining when to deposit social security and Medicare taxes and withheld federal income tax. The schedules tell when a deposit is due after a tax liability arises (for example, when there is a payday). Before the beginning of each calendar year, employers must determine which of the two deposit schedules to use. The deposit schedule to use is based on the total tax liability reported during a lookback period. The deposit schedule isn’t determined by how often employers pay employees or make deposits. These rules don’t apply to federal unemployment (FUTA) tax. See the Instructions for Form 940 for information on depositing FUTA tax. (IRS Notice 931, Deposit Requirements for Employment Taxes, Revised October 2016.)
Visit our News Library to read more news stories.