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Publication 225

Reporting and Paying Social Security, Medicare, and Withheld Federal Income Taxes(p79)

You must withhold federal income, social security, and Medicare taxes required to be withheld from the salaries and wages of your employees. You’re liable for the payment of these taxes to the federal government whether or not you collect them from your employees. If, for example, you withhold less than the correct tax from an employee's wages, you’re still liable for the full amount. You must also pay the employer's share of social security and Medicare taxes. There is no employer share of Additional Medicare Tax.

Form 943.(p79)

Report withheld federal income tax, social security tax, and Medicare tax on Form 943. Your 2016 Form 943 is due by January 31, 2017 (or February 10, 2017, if you made deposits on time in full payment of the taxes due for the year).


Generally, you must deposit both the employer and employee shares of social security and Medicare taxes and federal income tax withheld during the year. However, you may make payments with Form 943 instead of depositing them if you accumulate less than a $2,500 tax liability ("Total taxes after adjustments" line on Form 943) during the year and you pay in full with a timely filed return.
For more information on deposit rules, see Pub. 51.
Electronic deposit requirement.(p79)
You must use EFT to make all federal tax deposits. Generally, an EFT is made using EFTPS. If you don't want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. Also, you may arrange for your financial institution to initiate a same-day wire payment on your behalf. EFTPS is a free service provided by the Department of Treasury. Services provided by your tax professional, financial institution, payroll service, or other third party may have a fee.
For more information on making federal tax deposits, see section 7 of Pub. 51. To get more information about EFTPS or to enroll in EFTPS, visit or call 1-800-555-4477 or 1-800-733-4829 (TDD). Additional information about EFTPS is also available in Pub. 966.

Form W-2.(p79)

By January 31, you must furnish each employee a Form W-2 showing total wages for the previous year and total federal income tax, social security tax, and Medicare tax withheld. However, if an employee stops working for you and asks for the form earlier, you must give it to the employee within 30 days of the later of the following dates.

Compensation paid to H-2A visa holders.(p80)

Report compensation of $600 or more paid to foreign agricultural workers who entered the country on H-2A visas in box 1 of Form W-2. Compensation paid to H-2A workers for agricultural labor performed in connection with this visa isn't subject to social security and Medicare taxes, and therefore shouldn't be reported as wages subject to social security tax (line 2), Medicare tax (line 4), or Additional Medicare Tax (line 6) on Form 943, and shouldn't be reported as social security wages (box 3) or Medicare wages (box 5) on Form W-2.
An employer isn’t required to withhold federal income tax from compensation paid to an H-2A worker for agricultural labor performed in connection with this visa unless the worker asks for withholding and the employer agrees. In this case, the worker must give the employer a completed Form W-4. Federal income tax withheld should be reported on Form 943, line 8, and in box 2 of Form W-2.
These reporting rules apply when the H-2A worker provides his or her TIN to the employer. However, if an H-2A visa worker didn't provide the employer with a TIN, the employee is subject to backup withholding. The employer must report the wages and backup withholding on Form 1099-MISC. The employer must also report the backup withholding on Form 945, line 2.
For more information, see the Instructions for Form 1099-MISC and the Instructions for Form 945.

Trust fund recovery penalty.(p80)

If you’re responsible for withholding, accounting for, depositing, or paying federal income, social security, and Medicare taxes (that is, trust fund taxes) and willfully fail to do so, you can be held liable for a penalty equal to the withheld tax not paid. A responsible person can be an officer of a corporation, a partner, a sole proprietor, or an employee of any form of business. A trustee or agent with authority over the funds of the business can also be held responsible for the penalty.
Willfully means voluntarily, consciously, and intentionally. Paying other expenses of the business instead of the taxes due is acting willfully.

Consequences of treating an employee as an independent contractor.(p80)

If you classify an employee as an independent contractor and you have no reasonable basis for doing so, you may be held liable for employment taxes for that worker. See Pub. 15-A for more information.