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When Do I Make Payroll Tax Deposits?

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Question: When Do I Make Payroll Tax Deposits?
Payroll taxes are deposited with the IRS using Electronic Federal Tax Payment System (EFTPS). The timing of payments is made either semi-weekly or monthly, depending on the average amount of deposits. Here is information about figuring out which deposit schedule applies to your company.
Answer:

Payroll taxes are deposited by employers with the IRS either semi-weekly or monthly, based on the "look back period" (the twelve-month period ending on June 30).

Determining the Schedule

  • First, you must find your total payroll tax liability (Social Security/Medicare) for the "look back period" (the twelve-month period ending on June 30th)
  • If you are a new employer and you did not have employees during this "look back" period, you are a monthly depositor
  • If your total payroll taxes for the "look back period" were $50,000 or less, you are a monthly depositor
  • If your total payroll taxes for the "look back period" were more than $50,000, you make deposits on the semi-weekly schedule.

More on Tax Deposit Dates

  • Monthly deposits must be made by the 15th day of the following month. So your payroll deposit for March must be made by April 15.
  • Semi-weekly deposits are made on the following schedule:
    • Deposit taxes from payrolls paid on Saturday, Sunday, Monday or Tuesday by the following Friday
    • Deposit taxes from payrolls paid on Wednesday, Thursday or Friday by the following Wednesday.

Still More ...

  • If your payroll tax obligation is less than $2500 in a quarter, you can deposit these taxes with a "timely filed return" (assuming a Form 941).
  • If your payroll tax obligation is $100,000 or more, you must deposit the next day and you must continue to make next-day deposits for the rest of that year and the following year.
  • Deposit errors are not penalized if they don't exceed $100 or 2% of the amount of employment taxes required to be deposited. You must make up the balance due by a pre-defined make-up day in order to avoid further penalties.
  • If a deposit is required to be made on a day that is not a banking day, the deposit is considered timely made if it is made by the close of the next banking day. In addition to federal and state bank holidays, Saturday and Sunday are treated as non-banking days.
  • Semiweekly depositors have at least three banking days following the close of the semiweekly period to deposit taxes accumulated during the semiweekly period.

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