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taxmap/pubs/p51-000.htm#en_us_publink1000195425
Publication 51

(Circular A), Agricultural Employer's Tax Guide

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Future Developments(p1)

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For the latest information about developments related to Pub. 51, such as legislation enacted after it was published, go to IRS.gov/Pub51.

What's New(p1)

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taxmap/pubs/p51-000.htm#en_us_publink100076118
2018 federal income tax withholding.(p1)
This publication includes the 2018 Percentage Method Tables and Wage Bracket Method Tables for Income Tax Withholding. The 2018 withholding tables incorporate changes to the individual tax rates based on tax legislation enacted on December 22, 2017 (P.L. 115-97). Employers should implement the 2018 withholding tables as soon as possible, but not later than February 15, 2018. Continue to use the 2017 withholding tables until you implement the 2018 withholding tables. The new withholding tables are designed to work with the Forms W-4, Employee's Withholding Allowance Certificate, that your employees previously gave you.
To help employees determine their withholding, the IRS is revising the withholding tax calculator available at IRS.gov/W4App. The IRS anticipates that this calculator will be available by the end of February. Encourage your employees to use the withholding calculator to determine if they should give you a new Form W-4 for 2018. The IRS is also working on revising Form W-4 for 2018. The calculator and revised Form W-4 can be used by employees who wish to update their withholding in response to the new law or changes in their personal circumstances in 2018, and by workers starting a new job. Until a new Form W-4 is issued, employees and employers should continue to use the 2017 Form W-4. For more information, go to IRS.gov/NR1036.
An employee who experiences a change of status that causes a reduction in the number of withholding allowances isn't required to give his or her employer a new Form W-4 until 30 days after the 2018 Form W-4 is released. An employee that has a reduction in the number of withholding allowances solely due to changes from P.L. 115-97 isn't required to give his or her employer a new Form W-4 during 2018 but may do so at any time. Employees may use the 2017 Form W-4 to report changes to withholding allowances until 30 days after the 2018 Form W-4 is released. New employees may continue to claim allowances on the 2017 Form W-4 until 30 days after the 2018 Form W-4 is released. Employees who submit new Forms W-4 for 2018 using the 2017 Form W-4 don't need to resubmit a 2018 Form W-4 when the 2018 Form W-4 is released.
taxmap/pubs/p51-000.htm#en_us_publink100076119
Exempt Form W-4.(p2)
Generally, an employee may claim exemption from federal income tax withholding because he or she had no federal income tax liability last year and expects none this year. To continue to be exempt from withholding in 2018, an employee must give you a new Form W-4 by February 28, 2018. However, the 2018 Form W-4 may not be available before February 28, 2018. Employees may claim exemption from withholding for 2018 using the 2017 Form W-4 until 30 days after the 2018 Form W-4 is released. The 2017 Form W-4 must be (1) edited by striking "2017" in the text on line 7 and entering "2018" in its place, (2) completed by entering "Exempt 2018" on line 7, or (3) not edited but signed in 2018 and submitted under procedures established by the employer for the employee to certify entitlement to exempt status for 2018 by using the 2017 Form W-4 to claim exemption from withholding for 2018. In addition to 1–3 above, the employee can use any substantially similar method to 1–3 that clearly conveys in writing the employee's intent to certify his or her exemption from withholding for 2018. Employers that have established electronic systems for furnishing withholding allowance certificates may change their electronic systems to substantially conform with the options discussed above.
If the employee doesn't give you Form W-4 by February 28, 2018, follow the withholding rules discussed in section 5 under Exemption from federal income tax withholding. Employees who claimed exemption from withholding for 2018 using the 2017 Form W-4, as discussed above, don't need to resubmit a 2018 Form W-4 when the 2018 Form W-4 is released.
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Withholding allowance.(p2)
The 2018 amount for one withholding allowance on an annual basis is $4,150.
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Withholding on supplemental wages.(p2)
P.L. 115-97 lowered the withholding rates on supplemental wages. See Supplemental wages in section 5.
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Social security and Medicare tax for 2018.(p2)
The social security tax rate is 6.2% each for the employee and employer, unchanged from 2017. The social security wage base limit is $128,400.
The Medicare tax rate is 1.45% each for the employee and employer, unchanged from 2017. There is no wage base limit for Medicare tax.
Social security and Medicare taxes apply to the wages of household workers you pay $2,100 or more in cash in 2018.
taxmap/pubs/p51-000.htm#en_us_publink100067109
New Schedule R (Form 943), Allocation Schedule for Aggregate Form 943 Filers.(p2)
Agents approved by the IRS under section 3504 and certified professional employer organizations (CPEOs) must now complete and file the new Schedule R (Form 943) each time they file an aggregate Form 943, Employer's Annual Federal Tax Return for Agricultural Employees. To request approval to act as an agent for an employer under section 3504, the agent must file Form 2678 with the IRS. Form 2678 must be previously filed and approved by the IRS before filing Schedule R. To become a CPEO, the organization must apply through the IRS Online Registration System at IRS.gov/CPEO. CPEOs file Form 8973, Certified Professional Employer Organization/Customer Reporting Agreement, to notify the IRS that they've started or ended a service contract with a client or customer.
taxmap/pubs/p51-000.htm#en_us_publink100067110
Qualified small business payroll tax credit for increasing research activities.(p2)
For tax years beginning after December 31, 2015, a qualified small business may elect to claim up to $250,000 of its credit for increasing research activities as a payroll tax credit against the employer's share of social security tax. The portion of the credit used against the employer's share of social security tax is allowed in the first calendar quarter beginning after the date that the qualified small business filed its income tax return. The first Form 943 that you can claim this credit on is Form 943 filed for calendar year 2017. The election and determination of the credit amount that will be used against the employer's share of social security tax are made on Form 6765, Credit for Increasing Research Activities. The amount from Form 6765, line 44, must then be reported on Form 8974, Qualified Small Business Payroll Tax Credit for Increasing Research Activities. Form 8974 is used to determine the amount of the credit that can be used in the current year. The amount from Form 8974, line 12, is reported on Form 943, line 12. If you're claiming the research payroll tax credit on your Form 943, you must attach Form 8974 to Form 943. For more information about the payroll tax credit, see Notice 2017-23, 2017-16 I.R.B. 1100, available at IRS.gov/irb/2017-16_IRB/ar07.html. Also see the line 17 instructions in the Instructions for Form 943.
taxmap/pubs/p51-000.htm#en_us_publink100070984
Disaster tax relief.(p2)
Disaster tax relief was enacted for those impacted by Hurricane Harvey, Irma, or Maria. Additionally, the IRS has provided special relief designed to support employer leave-based donation programs to aid the victims of these hurricanes and to aid the victims of the California wildfires that began October 8, 2017. For more information about disaster relief, including the treatment of amounts paid to qualified tax-exempt organizations under employer leave-based donation programs, see Pub. 976.

Reminders(p3)

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taxmap/pubs/p51-000.htm#en_us_publink100066970
Certification program for professional employer organizations.(p3)
The Tax Increase Prevention Act of 2014 required the IRS to establish a voluntary certification program for professional employer organizations (PEOs). PEOs handle various payroll administration and tax reporting responsibilities for their business clients and are typically paid a fee based on payroll costs. To become and remain certified under the certification program, CPEOs must meet various requirements described in sections 3511 and 7705 and related published guidance. Certification as a CPEO may affect the employment tax liabilities of both the CPEO and its customers. A CPEO is generally treated as the employer of any individual who performs services for a customer of the CPEO and is covered by a contract described in section 7705(e)(2) between the CPEO and the customer (CPEO contract), but only for wages and other compensation paid to the individual by the CPEO. For more information, go to IRS.gov/CPEO. Also see Revenue Procedure 2017-14, 2017-3 I.R.B. 426, available at IRS.gov/irb/2017-03_IRB/ar14.html.
taxmap/pubs/p51-000.htm#en_us_publink100047323
Work opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans. (p3)
The work opportunity tax credit is available for eligible unemployed veterans who begin work after November 22, 2011, and before January 1, 2020. Qualified tax-exempt organizations that hire eligible unemployed veterans can claim the work opportunity tax credit against their payroll tax liability using Form 5884-C. For more information, go to IRS.gov/WOTC.
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COBRA premium assistance credit.(p3)
Effective for tax periods beginning after December 31, 2013, the credit for COBRA premium assistance payments can't be claimed on Form 943. Instead, after filing your Form 943, file Form 943-X, Adjusted Employer's Annual Federal Tax Return for Agricultural Employees or Claim for Refund, to claim the COBRA premium assistance credit. Filing a Form 943-X before filing a Form 943 for the year may result in errors or delays in processing your Form 943-X. For more information, see the Instructions for Form 943 or go to IRS.gov/COBRACredit.
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Definition of marriage.(p3)
A marriage of two individuals is recognized for federal tax purposes if the marriage is recognized by the state, possession, or territory of the United States in which the marriage is entered into, regardless of legal residence. Two individuals who enter into a relationship that is denominated as marriage under the laws of a foreign jurisdiction are recognized as married for federal tax purposes if the relationship would be recognized as marriage under the laws of at least one state, possession, or territory of the United States, regardless of legal residence. Individuals who have entered into a registered domestic partnership, civil union, or other similar relationship that isn't denominated as a marriage under the law of the state, possession, or territory of the United States where such relationship was entered into aren't lawfully married for federal tax purposes, regardless of legal residence.
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Outsourcing payroll duties.(p3)
Generally, you're responsible to ensure that tax returns are filed and deposits and payments are made, even if you contract with a third party to perform these acts. You remain responsible if the third party fails to perform any required action. If you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to a third-party payer, such as a payroll service provider or reporting agent, go to IRS.gov/OutsourcingPayrollDuties for helpful information on this topic. If a CPEO pays wages and other compensation to an individual performing services for you, and the services are covered by a contract described in section 7705(e)(2) between you and the CPEO (CPEO contract), then the CPEO is generally treated as the employer, but only for wages and other compensation paid to the individual by the CPEO. However, with respect to certain employees covered by a CPEO contract, a customer may also be treated as an employer of the employees and, consequently, may also be liable for federal employment taxes imposed on wages and other compensation paid by the CPEO to such employees. For more information on the different types of third-party payer arrangements, see section 16 in Pub. 15.
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Disregarded entities and qualified subchapter S subsidiaries (QSubs).(p3)
Eligible single-owner disregarded entities and QSubs are treated as separate entities for employment tax purposes. Eligible single-member entities must report and pay employment taxes on wages paid to their employees using the entities' own names and employer identification numbers (EINs). See Regulations sections 1.1361-4(a)(7) and 301.7701-2(c)(2)(iv).
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Differential wage payments.(p3)
Qualified differential wage payments made by employers to individuals serving in the Armed Forces after 2008 are subject to income tax withholding but not social security, Medicare, or FUTA taxes. For more information, see section 5 of Pub. 15.
taxmap/pubs/p51-000.htm#en_us_publink1000255139
Federal tax deposits must be made by electronic funds transfer (EFT).(p3)
You must use EFT to make all federal tax deposits. Generally, an EFT is made using the Electronic Federal Tax Payment System (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 How To Deposit in section 7. To get more information about EFTPS or to enroll in EFTPS, go to EFTPS.gov or call 1-800-555-4477 or 1-800-733-4829 (TDD). Additional information about EFTPS is also available in Pub. 966.
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Electronic filing and payment.(p4)
Now, more than ever before, businesses can enjoy the benefits of filing tax returns and paying their taxes electronically. Whether you rely on a tax professional or handle your own taxes, the IRS offers you convenient programs to make it easier.
Spend less time and worry on taxes and more time running your business. Use e-file and EFTPS to your benefit.
  • For e-file, go to IRS.gov/EmploymentEfile for additional information. A fee may be charged to file electronically.
  • For EFTPS, go to EFTPS.gov or call EFTPS Customer Service at 1-800-555-4477 or 1-800-733-4829 (TDD) for additional information.
  • For electronic filing of Form W-2, go to SSA.gov/employer.
EIC
If you’re filing your tax return or paying your federal taxes electronically, a valid EIN is required at the time the return is filed or the payment is made. If a valid EIN isn't provided, the return or payment won't be processed. This may result in penalties.
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Electronic funds withdrawal (EFW).(p4)
If you file your employment tax return electronically, you can e-file and use EFW to pay the balance due in a single step using tax preparation software or through a tax professional. However, don't use EFW to make federal tax deposits. For more information on paying your taxes using EFW, go to IRS.gov/EFW.
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Credit or debit card payments.(p4)
You can pay the balance due shown on your employment tax return by credit or debit card. Don't use a credit or debit card to make federal tax deposits. For more information on paying your taxes with a credit or debit card, go to IRS.gov/PayByCard. Your payment will be processed by a payment processor who will charge a processing fee.
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Online payment agreement.(p4)
You may be eligible to apply for an installment agreement online if you can't pay the full amount of tax you owe when you file your employment tax return. For more information, see the instructions for your employment tax return or go to IRS.gov/OPA.
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When you hire a new employee.(p4)
Ask each new employee to complete the 2018 Form W-4, or its Spanish version, Formulario W-4(SP). New employees may continue to claim allowances on the 2017 Form W-4 until 30 days after the 2018 Form W-4 is released. Also, ask the employee to show you his or her social security card so that you can record the employee's name and social security number (SSN) accurately. If the employee has lost the card or recently changed names, have the employee apply for a duplicate or corrected card. If the employee doesn't have a card, have the employee apply for one on Form SS-5, Application for a Social Security Card. See section 1 for more information.
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Eligibility for employment.(p4)
You must verify that each new employee is legally eligible to work in the United States. This includes completing the U.S. Citizenship and Immigration Services (USCIS) Form I-9, Employment Eligibility Verification. You can get Form I-9 at USCIS.gov/Forms, USCIS offices, or by calling 1-800-870-3676. For more information, go to the USCIS website at USCIS.gov/I-9-Central or call 1-800-375-5283 or 1-800-767-1833 (TDD).
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New hire reporting.(p4)
You’re required to report any new employee to a designated state new-hire registry. A new employee is an employee who hasn't previously been employed by you or was previously employed by you but has been separated from such prior employment for at least 60 consecutive days. Many states accept a copy of Form W-4 with employer information added. Visit the Office of Child Support Enforcement's website at acf.hhs.gov/css/employers for more information.
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Dishonored payments.(p4)
Any form of payment that is dishonored and returned from a financial institution is subject to a penalty. The penalty is $25 or 2% of the payment, whichever is more. However, the penalty on dishonored payments of $24.99 or less is an amount equal to the payment. For example, a dishonored payment of $18 is charged a penalty of $18.
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Forms in Spanish.(p4)
You can provide Formulario W-4(SP) in place of Form W-4 to your Spanish-speaking employees. For more information, see Pub. 17(SP), El Impuesto Federal sobre los Ingresos (Para Personas Físicas).
For nonemployees, such as independent contractors, Formulario W-9(SP), Solicitud y Certificación del Número de Identificación del Contribuyente, may be used in place of Form W-9, Request for Taxpayer Identification Number and Certification.
References in this publication to Form W-4 or Form W-9 also apply to their equivalent Spanish translations—Formulario W-4(SP) or Formulario W-9(SP).
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Information returns.(p4)
You may be required to file information returns to report certain types of payments made during the year. For example, you must file Form 1099-MISC, Miscellaneous Income, to report payments of $600 or more to persons not treated as employees (for example, independent contractors) for services performed for your trade or business. For details about filing Forms 1099 and for information about required electronic filing, see the General Instructions for Certain Information Returns for general information and the separate, specific instructions for each information return that you file (for example, the Instructions for Form 1099-MISC). Generally, don't use Forms 1099 to report wages or other compensation that you paid to employees; report these amounts on Form W-2.
See the General Instructions for Forms W-2 and W-3 for details about filing Forms W-2 and for information about required electronic filing. If you file 250 or more Forms W-2, you must file them electronically. Electronic filing is the only form of magnetic media that the IRS and the Social Security Administration (SSA) will accept.
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Information reporting customer service site.(p4)
The IRS operates an information return customer service site to answer questions about reporting on Forms W-2, W-3, 1099, and other information returns. If you have questions related to reporting on information returns, you may call 1-866-455-7438 (toll free), 304-263-8700 (toll call), or 304-579-4827 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability). The call site can also be reached by email at mccirp@irs.gov. Don't include tax identification numbers (TINs) or attachments in email correspondence because electronic mail isn't secure.
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Web-based application for an EIN.(p5)
Go to IRS.gov/EIN to apply for an EIN online. See section 1 for additional information.
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When a crew leader furnishes workers to you.(p5)
Record the crew leader's name, address, and EIN. See sections 2 and 10.
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Change of address.(p5)
Use Form 8822-B to notify the IRS of an address change. Don't mail Form 8822-B with your employment tax return.
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Change of responsible party.(p5)
Any entity with an EIN must file Form 8822-B to report a change to its responsible party. Form 8822-B must be filed within 60 days of the change. For a definition of "responsible party," see the Form 8822-B instructions.
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Ordering forms and publications.(p5)
Go to IRS.gov/Forms to download forms and publications. Otherwise, you can go to IRS.gov/OrderForms to order current- and prior-year forms and instructions. Your order should arrive within 10 business days.
Instead of ordering paper Forms W-2 and W-3, consider filing them electronically using the SSA's free e-file service. Visit the SSA's Employer W-2 Filing Instructions & Information website at SSA.gov/employer to register for Business Services Online. You will be able to create and file "fill-in" versions of Forms W-2 with the SSA and can print out completed copies of Forms W-2 for filing with state and local governments, distribution to your employees, and for your records.
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Tax questions.(p5)
If you have an employment tax question, check the information available on IRS.gov or call 1-800-829-4933 or 1-800-829-4059 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability) Monday–Friday from 7:00 a.m. to 7:00 p.m. local time (Alaska and Hawaii follow Pacific time).
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Recordkeeping.(p5)
Keep all records of employment taxes for at least 4 years. These should be available for IRS review. Your records should include the following information.
  • Your EIN.
  • Amounts and dates of all wage, annuity, and pension payments.
  • Names, addresses, SSNs, and occupations of employees and recipients.
  • Any employee copies of Forms W-2 and W-2c returned to you as undeliverable.
  • Dates of employment for each employee.
  • Periods for which employees and recipients were paid while absent due to sickness or injury and the amount and weekly rate of payments you or third-party payers made to them.
  • Copies of employees' and recipients' income tax withholding allowance certificates (Forms W-4, W-4(SP), W-4P, and W-4S).
  • Dates and amounts of tax deposits you made and acknowledgment numbers for deposits made by EFTPS.
  • Copies of returns filed and confirmation numbers.
  • Records of fringe benefits and expense reimbursements provided to your employees, including substantiation.
If a crew leader furnished you with farmworkers, you must keep a record of the name, permanent mailing address, and EIN of the crew leader. If the crew leader has no permanent mailing address, record his or her present address.
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Private delivery services.(p5)
You can use certain private delivery services (PDSs) designated by the IRS to meet the "timely mailing as timely filing" rule for tax returns. Go to IRS.gov/PDS for the current list of PDSs.
The PDS can tell you how to get written proof of the mailing date.
For the IRS mailing address to use if you’re using a PDS, go to IRS.gov/PDSstreetAddresses.
EIC
PDSs can't deliver items to P.O. boxes. You must use the U.S. Postal Service to mail any item to an IRS P.O. box address.
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Zero Wage return.(p5)
If you haven't filed a “final” Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return, or Form 943, you must continue to file Forms 940 and 943 even for years during which you paid no wages. The IRS encourages you to file your “Zero Wage” Forms 940 and 943 electronically. Go to IRS.gov/EmploymentEfile for more information on electronic filing.
taxmap/pubs/p51-000.htm#en_us_publink100047964
Pub. 5146 explains employment tax examinations and appeal rights. (p5)
Pub. 5146 provides employers with information on how the IRS selects employment tax returns to be examined, what happens during an exam, and what options an employer has in responding to the results of an exam, including how to appeal the results. Pub. 5146 also includes information on worker classification issues and tip exams.
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Photographs of missing children.(p5)
The IRS is a proud partner with the National Center for Missing & Exploited Children® (NCMEC). Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

Calendar(p5)

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The following are important dates and responsibilities. See section 7 for information about depositing taxes reported on Forms 943 and 945, Annual Return of Withheld Federal Income Tax. See section 10 for information about depositing FUTA tax. Also see Pub. 509, Tax Calendars.
Deposit
If any date shown below for filing a return, furnishing a form, or depositing taxes falls on a Saturday, Sunday, or legal holiday, the due date is the next business day. The term "legal holiday" means any legal holiday in the District of Columbia. A statewide legal holiday delays a filing due date only if the IRS office where you’re required to file is located in that state. However, a statewide legal holiday doesn't delay the due date of federal tax deposits. See Deposits Due on Business Days Only in section 7. For any filing due date, you will meet the "file" or "furnish" requirement if the envelope containing the return or form is properly addressed, contains sufficient postage, and is postmarked by the U.S. Postal Service on or before the due date, or sent by an IRS-designated delivery service on or before the due date. See Private delivery services under Reminders, earlier, for more information.
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By January 31 (p6)
  • File Form 943. See section 8 for more information on Form 943. If you deposited all Form 943 taxes when due, you may file Form 943 by February 10.
  • File Form 940. See section 10 for more information on FUTA. If you deposited all the FUTA tax when due, you may file Form 940 by February 10.
  • File with the SSA Copy A of all 2017 paper and electronic Forms W-2 with Form W-3, Transmittal of Wage and Tax Statements. For more information on reporting Form W-2 information to the SSA electronically, visit the SSA's Employer W-2 Filing Instructions & Information webpage at SSA.gov/employer. If filing electronically via the SSA's Form W-2 Online service, the SSA will generate Form W-3 data from the electronic submission of Form(s) W-2.
  • Furnish each employee with a completed Form W-2.
  • File with the IRS Copy A of all 2017 paper and electronic Forms 1099-MISC that report nonemployee compensation, with Form 1096, Annual Summary and Transmittal of U.S. Information Returns. For information on filing information returns electronically with the IRS, see Pub. 1220. Other Forms 1099, including Forms 1099-MISC reporting anything other than nonemployee compensation, have different due dates. See the General Instructions for Certain Information Returns for more information.
  • Furnish each recipient to whom you paid $600 or more in nonemployee compensation with a completed Form 1099-MISC.
  • File Form 945 to report any nonpayroll federal income tax withheld in 2017. If you deposited all Form 945 taxes when due, you may file Form 945 by February 10.
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By February 28(p6)
Ask for a new Form W-4 or Formulario W-4(SP) from each employee who claimed exemption from federal income tax withholding last year.
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On March 1(p6)
Any Form W-4 claiming exemption from withholding for the previous year has now expired. Begin withholding for any employee who previously claimed exemption from withholding but hasn't given you a new Form W-4 for the current year. If the employee doesn't give you a new Form W-4, withhold tax based on the last valid Form W-4 you have for the employee that doesn't claim exemption from withholding or, if one doesn't exist, as if he or she is single with zero withholding allowances. See section 5 for more information. If the employee furnishes a new Form W-4 claiming exemption from withholding after February 28, you may apply the exemption to future wages, but don't refund taxes withheld while the exempt status wasn't in place.
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By April 30, July 31, October 31, and January 31(p6)
Deposit FUTA taxes. Deposit FUTA tax if the undeposited amount is over $500.
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Before December 1(p6)
Remind employees to submit a new Form W-4 if their marital status or withholding allowances have changed or will change for the next year.

taxmap/pubs/p51-000.htm#en_us_publink1000270846Introduction

This publication is for employers of agricultural workers (farmworkers). It contains information that you may need to comply with the laws for agricultural labor (farmwork) relating to social security and Medicare taxes, FUTA tax, and withheld federal income tax (employment taxes). It also has tax tables you need to figure the federal income taxes to withhold from each employee for 2018. Agricultural employers report social security and Medicare taxes and withheld federal income tax on Form 943 and report FUTA tax on Form 940.
When you pay your employees, you don't pay them all the money they earned. As their employer, you have the added responsibility of withholding taxes from their paychecks. The federal income tax and employees' share of social security and Medicare taxes that you withhold from your employees' paychecks are part of their wages that you pay to the United States Treasury instead of to your employees. Your employees trust that you pay the withheld taxes to the United States Treasury by making federal tax deposits. This is the reason that these withheld taxes are called trust fund taxes. If federal income, social security, or Medicare taxes that must be withheld aren't withheld or aren't deposited or paid to the United States Treasury, the trust fund recovery penalty may apply. See section 7 for more information.
If you have nonfarm employees, see Pub. 15. If you have employees in the U.S. Virgin Islands, Guam, American Samoa, or the Commonwealth of the Northern Mariana Islands, see Pub. 80. Pub. 15-A contains more employment-related information, including information about sick pay and pension income. Pub. 15-B contains information about the employment tax treatment and valuation of various types of noncash compensation. For additional information about employment taxes, go to IRS.gov/EmploymentTaxes. For general tax information relevant to agricultural employers, go to IRS.gov/AgricultureTaxCenter.
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Comments and suggestions.(p7)

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We welcome your comments about this publication and your suggestions for future editions.
You can send us comments from IRS.gov/FormComments.
Or you can write to:


Internal Revenue Service
Tax Forms and Publications
1111 Constitution Ave. NW, IR-6526
Washington, DC 20224


Although we can't respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax forms, instructions, and publications. We can't answer tax questions sent to the above address.
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COBRA premium assistance credit.(p7)

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The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) provides certain former employees, retirees, spouses, former spouses, and dependent children the right to temporary continuation of health coverage at group rates. COBRA generally covers multiemployer health plans and health plans maintained by private-sector employers (other than churches) with 20 or more full- and part-time employees. Parallel requirements apply to these plans under the Employee Retirement Income Security Act of 1974 (ERISA). Under the Public Health Service Act, COBRA requirements apply also to health plans covering state or local government employees. Similar requirements apply under the Federal Employees Health Benefits Program and under some state laws. For the premium assistance (or subsidy) discussed below, these requirements are all referred to as COBRA requirements.
Under the American Recovery and Reinvestment Act of 2009 (ARRA), employers are allowed a credit against "payroll taxes" (referred to in this publication as "employment taxes") for providing COBRA premium assistance to assistance-eligible individuals. For periods of COBRA continuation coverage beginning after February 16, 2009, a group health plan must treat an assistance-eligible individual as having paid the required COBRA continuation coverage premium if the individual elects COBRA coverage and pays 35% of the amount of the premium.
An assistance-eligible individual is a qualified beneficiary of an employer's group health plan who is eligible for COBRA continuation coverage during the period beginning September 1, 2008, and ending May 31, 2010, due to the involuntary termination from employment of a covered employee during the period and elects continuation COBRA coverage. The assistance for the coverage can last up to 15 months.
The COBRA premium assistance credit was available to an employer for premiums paid on behalf of employees who were involuntarily terminated from employment between September 1, 2008, and May 31, 2010. The COBRA premium assistance credit isn't available for individuals who were involuntarily terminated after May 31, 2010. Therefore, only in rare circumstances will the credit still be available, such as instances where COBRA eligibility was delayed as a result of employer-provided health insurance coverage following termination. For more information about the credit, see Notice 2009-27, 2009-16 I.R.B. 838, available at IRS.gov/irb/2009-16_IRB/ar09.html.
Administrators of the group health plans (or other entities) that provide or administer COBRA continuation coverage must provide notice to assistance-eligible individuals of the COBRA premium assistance.
The 65% of the premium not paid by the assistance-eligible individual is reimbursed to the employer maintaining the group health plan. The reimbursement is made through a credit against the employer's employment tax liabilities. For information on how to claim the credit, see the Instructions for Form 943-X. The credit is treated as a deposit made on the first day of the return period. In the case of a multiemployer plan, the credit is claimed by the plan, rather than the employer. In the case of an insured plan subject to state law continuation coverage requirements, the credit is claimed by the insurance company, rather than the employer.
Anyone claiming the credit for COBRA premium assistance payments must maintain the following information to support their claim.
For more information, go to IRS.gov/COBRACredit.

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Useful items

You may want to see:


Publication
 15  Employer's Tax Guide
 15-A  Employer's Supplemental Tax Guide
 15-B  Employer's Tax Guide to Fringe Benefits
 225  Farmer's Tax Guide
 535  Business Expenses
 583  Starting a Business and Keeping Records
 1635  Employer Identification Number: Understanding Your EIN
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1. Taxpayer Identification Numbers (TINs)(p8)

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If you’re required to withhold any federal income, social security, or Medicare taxes, you will need an EIN for yourself. Also, you will need the SSN of each employee and the name of each employee as shown on the employee's social security card.
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Employer identification number (EIN).(p8)

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An EIN is a nine-digit number that the IRS issues. The digits are arranged as follows: 00-0000000. It is used to identify the tax accounts of employers and certain others who have no employees. Use your EIN on all of the items that you send to the IRS and the SSA.
If you don't have an EIN, you may apply for one online by visiting IRS.gov/EIN. You may also apply for an EIN by faxing or mailing Form SS-4 to the IRS. Don't use an SSN in place of an EIN.
If you don't have an EIN by the time a return is due, file a paper return and write "Applied For" and the date you applied for it in the space shown for the number. If you took over another employer's business, don't use that employer's EIN.
You should have only one EIN. If you have more than one, and aren't sure which one to use, call the toll-free Business and Specialty Tax Line at 1-800-829-4933 or 1-800-829-4059 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability). Provide the EINs that you have, the name and address to which each number was assigned, and the address of your principal place of business. The IRS will tell you which EIN to use. For more information, see Pub. 1635.
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When you receive your EIN.(p8)
If you’re a new employer that indicated a federal tax obligation when requesting an EIN, you will be pre-enrolled in EFTPS. You will receive information in your EIN Package about Express Enrollment and an additional mailing containing your EFTPS personal identification number (PIN) and instructions for activating your PIN. Call the toll-free number located in your "How To Activate Your EFTPS Enrollment" brochure to activate your enrollment and begin making your employment tax deposits. If you outsource any of your payroll and related tax duties to a third-party payer, such as a payroll service provider or reporting agent, be sure to tell them about your EFTPS enrollment.
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Social security number (SSN).(p8)

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An employee's SSN consists of nine digits arranged as follows: 000-00-0000. You must obtain each employee's name and SSN as shown on the employee's social security card because you must enter them on Form W-2. Don't accept a social security card that says "Not valid for employment." A social security number issued with this legend doesn't permit employment. You may, but aren't required to, photocopy the social security card if the employee provides it. If you don't show the employee's correct name and SSN on Form W-2, you may owe a penalty unless you have reasonable cause. See Pub. 1586, Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs, for information on the requirement to solicit the employee's SSN.
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Applying for a social security card.(p8)

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Any employee who is legally eligible to work in the United States and doesn't have a social security card can get one by completing Form SS-5 and submitting the necessary documentation to the SSA. You can get Form SS-5 at SSA.gov/forms/ss-5.pdf, SSA offices, or by calling 1-800-772-1213 or 1-800-325-0778 (TTY). The employee must complete and sign Form SS-5; it can't be filed by the employer. You may be asked to supply a letter to accompany Form SS-5 if the employee has exceeded his or her yearly or lifetime limit for the number of replacement cards allowed.
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Applying for an SSN. (p8)

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If you file Form W-2 on paper and your employee has applied for an SSN but doesn't have one when you must file Form W-2, enter "Applied For" on the form. If you’re filing electronically, enter all zeros (000-00-0000 if creating forms online or 000000000 if uploading a file) in the SSN field. When the employee receives the SSN, file Copy A of Form W-2c, Corrected Wage and Tax Statement, with the SSA to show the employee's SSN. Furnish Copies B, C, and 2 of Form W-2c to the employee. Up to 25 Forms W-2c per Form W-3c, Transmittal of Corrected Wage and Tax Statements, may be filed per session over the Internet, with no limit on the number of sessions. For more information, visit the SSA's Employer W-2 Filing Instructions & Information webpage at SSA.gov/employer. Advise your employee to correct the SSN on his or her original Form W-2.
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Correctly record the employee's name and SSN. (p8)

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Record the name and SSN of each employee as they are shown on the employee's social security card. If the employee's name isn't correct as shown on the card (for example, because of marriage or divorce), the employee should request an updated card from the SSA. Continue to report the employee's wages under the old name until the employee shows you an updated social security card with the new name.
If the SSA issues the employee an updated card after a name change, or a new card with a different SSN after a change in alien work status, file a Form W-2c to correct the name/SSN reported on the most recently filed Form W-2. It isn't necessary to correct other years if the previous name and SSN were used for years before the most recent Form W-2.
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IRS individual taxpayer identification numbers (ITINs) for aliens.(p8)

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Don't accept an ITIN in place of an SSN for employee identification or for work. An ITIN is issued for use by resident and nonresident aliens who need identification for tax purposes, but who aren't eligible for U.S. employment. You can identify an ITIN because it’s a nine-digit number, formatted like an SSN, that starts with the number "9" and has a range of numbers from "50–65,""70–88,""90–92," and "94–99" for the fourth and fifth digits (for example, 9NN-7N-NNNN).
EIC
An individual with an ITIN who later becomes eligible to work in the United States must obtain an SSN. If the individual is currently eligible to work in the United States, instruct the individual to apply for an SSN and follow the instructions under Applying for an SSN, earlier in this section. Don't use an ITIN in place of an SSN on Form W-2.
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Verification of SSNs.(p9)

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Employers and authorized reporting agents can use the Social Security Number Verification Service (SSNVS) to instantly verify up to 10 employee names and SSNs (per screen) at a time, or submit an electronic file of up to 250,000 names and SSNs and usually receive results the next business day. Visit SSA.gov/employer/ssnv.htm for more information.
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Registering for SSNVS.(p9)
You must register online and receive authorization from your employer to use SSNVS. To register, visit the SSA's website at SSA.gov/bso and click on the Register link under Business Services Online. Follow the registration instructions to obtain a user identification (ID) and password. You will need to provide the following information about yourself and your company.When you have completed the online registration process, the SSA will mail a one-time activation code to your employer. You must enter the activation code online to use SSNVS.