Table of Contents
Section references are to the Internal Revenue Code unless otherwise noted.
For the latest information about developments related to Form 945 and its instructions, such as legislation enacted after they were published, go to IRS.gov/Form945.
Correcting a previously filed Form 945. If you discover an error on a previously filed Form 945, make the correction using Form 945-X, Adjusted Annual Return of Withheld Federal Income Tax or Claim for Refund. Form 945-X is filed separately from Form 945. For more information, see the Instructions for Form 945-X or go to IRS.gov/CorrectingEmploymentTaxes.
Federal tax deposits must be made by electronic funds transfer (EFT). 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 the 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 11 of Pub. 15. To get more information about EFTPS or to enroll in EFTPS, go to EFTPS.gov, or call 800-555-4477. To contact EFTPS using Telecommunications Relay Services (TRS) for people who are deaf, hard of hearing, or have a speech disability, dial 711 and then provide the TRS assistant the 800-555-4477 number above or 800-733-4829. Additional information about EFTPS is also available in Pub. 966.
Caution! For an EFTPS deposit to be on time, you must submit the deposit by 8 p.m. Eastern time the day before the date the deposit is due.
Same-day wire payment option. If you fail to submit a deposit transaction on EFTPS by 8 p.m. Eastern time the day before the date a deposit is due, you can still make your deposit on time by using the Federal Tax Collection Service (FTCS) to make a same-day wire payment. To use the same-day wire payment method, you will need to make arrangements with your financial institution ahead of time. Please check with your financial institution regarding availability, deadlines, and costs. Your financial institution may charge you a fee for payments made this way. To learn more about the information you will need to give your financial institution to make a same-day wire payment, go to IRS.gov/SameDayWire.
Timeliness of federal tax deposits. If a deposit is required to be made on a day that isn't a business day, the deposit is considered timely if it is made by the close of the next business day. A business day is any day other than a Saturday, Sunday, or legal holiday. The term "legal holiday" for deposit purposes includes only those legal holidays in the District of Columbia. Legal holidays in the District of Columbia are provided in section 11 of Pub. 15.
Electronic filing and payment. Businesses can enjoy the benefits of filing tax returns and paying their federal taxes electronically. Whether you rely on a tax professional or handle your own taxes, the IRS offers you convenient programs to make filing and paying easier. Spend less time worrying about taxes and more time running your business. Use e-file and EFTPS to your benefit.
Caution! If you're filing your tax return or paying your federal taxes electronically, a valid employer identification number (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. See Employer Identification Number (EIN), later, for more information about applying for an EIN.
Electronic funds withdrawal (EFW). If you file Form 945 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.
Credit or debit card payments. You can pay the balance due shown on Form 945 by credit or debit card. Your payment will be processed by a payment processor who will charge a processing fee. 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.
Online payment agreement. 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 return. For more information, see What if you can't pay in full, later.
Form 1099-NEC. Use Form 1099-NEC to report nonemployee compensation paid in 2023 and any backup withholding on the compensation.
Paid preparers. If you use a paid preparer to complete Form 945, the paid preparer must complete and sign the paid preparer's section of the form.
Outsourcing your tax duties. 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. Before you choose to outsource any of your tax duties (that is, withholding, reporting, and paying over federal income tax) 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. For more information on the different types of third-party payer arrangements, see section 16 in Pub. 15.
How to get forms and publications. You can download or print some of the forms and publications you may need on IRS.gov/Forms. Otherwise, you can go to IRS.gov/OrderForms to place an order and have forms mailed to you. You should receive your order within 10 business days.
Where can you get telephone help? For answers to your questions about completing Form 945 or tax deposit rules, you can call the IRS at 800-829-4933 (Business and Specialty Tax Line) or 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).
Photographs of missing children. The IRS is a proud partner with the National Center for Missing and Exploited Children® (NCMEC). Photographs of missing children selected by the Center may appear in instructions 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.
These instructions give you some background information about Form 945. They tell you who must file Form 945, how to complete it line by line, and when and where to file it.
Use Form 945 to report federal income tax withheld (or required to be withheld) from nonpayroll payments. Nonpayroll payments include:
Report all federal income tax withholding from nonpayroll payments or distributions annually on one Form 945. Don't file more than one Form 945 for any calendar year.
All federal income tax withholding reported on Forms 1099 (for example, Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.; Form 1099-MISC, Miscellaneous Information; or Form 1099-NEC, Nonemployee Compensation) or Form W-2G, Certain Gambling Winnings, must be reported on Form 945.
Don't report federal income tax withholding from wages on Form 945. All federal income tax withholding and employment taxes reported on Form W-2, Wage and Tax Statement, must be reported on Form 941, Employer's QUARTERLY Federal Tax Return; Form 943, Employer's Annual Federal Tax Return for Agricultural Employees; Form 944, Employer's ANNUAL Federal Tax Return; Schedule H (Form 1040), Household Employment Taxes; or Form CT-1, Employer's Annual Railroad Retirement Tax Return, as appropriate.
Don't report on Form 945 federal income tax withheld on distributions to participants from nonqualified pension plans (including nongovernmental section 457(b) plans) and some other deferred compensation arrangements that are treated as wages and are reported on Form W-2. Report such withholding on Form 941 or Form 944. See Distributions from nonqualified pension plans and deferred compensation plans in the Reminders section of Pub. 15 for more information.
Compensation paid to H-2A visa holders. Generally, report compensation of $600 or more paid to foreign agricultural workers who entered the country on H-2A visas on Form W-2 and Form 943. However, if an H-2A visa worker didn't provide the employer with a taxpayer identification number, 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 on foreign agricultural workers on H-2A visas, go to IRS.gov/H2A.
If you withhold or are required to withhold federal income tax (including backup withholding) from nonpayroll payments, you must file Form 945. See Purpose of Form 945, earlier. You don't have to file Form 945 for those years in which you don't have a nonpayroll tax liability. Don't report on Form 945 withholding that is required to be reported on Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons.
If you file Form 945, you may also be required to file Form 945-A, Annual Record of Federal Tax Liability. See the line 7 instructions for details.
For 2023, file Form 945 by January 31, 2024. However, if you made deposits on time in full payment of the taxes for the year, you may file the return by February 12, 2024.
If we receive your return after the due date, we will treat your return as filed on time if the envelope containing your return 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 private delivery service (PDS) on or before the due date. However, if you don't follow these guidelines, we will consider your return filed when it is actually received.
You're encouraged to file Form 945 electronically. Go to IRS.gov/EmploymentEfile for more information on electronic filing. If you file a paper return, where you file depends on whether you include a payment with Form 945. Mail your return to the address listed for your location in the table below.
PDSs can't deliver to P.O. boxes. You must use the U.S. Postal Service to mail an item to a P.O. box address. Go to IRS.gov/PDS for the current list of PDSs. For the IRS mailing address to use if you're using a PDS, go to IRS.gov/PDSstreetAddresses. Select the mailing address listed on the webpage that is in the same state as the address to which you would mail returns filed without a payment, as shown in the table below.
| If you're in . . . | Without a payment . . . | With a payment . . . |
|---|---|---|
| Connecticut, Delaware, District of Columbia, Georgia, Illinois, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Vermont, Virginia, West Virginia, Wisconsin |
Department of the Treasury Internal Revenue Service Kansas City, MO 64999-0042 |
Internal Revenue Service P.O. Box 806534 Cincinnati, OH 45280-6534 |
| Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Hawaii, Idaho, Iowa, Kansas, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Texas, Utah, Washington, Wyoming |
Department of the Treasury Internal Revenue Service Ogden, UT 84201-0042 |
Internal Revenue Service P.O. Box 932300 Louisville, KY 40293-2300 |
| No legal residence or principal place of business in any state | Department of the Treasury Internal Revenue Service P.O. Box 409101 Ogden, UT 84409 |
Internal Revenue Service P.O. Box 932300 Louisville, KY 40293-2300 |
| Special filing address for exempt organizations; governmental entities; and Indian tribal governmental entities; regardless of location |
Department of the Treasury Internal Revenue Service Ogden, UT 84201-0042 |
Internal Revenue Service P.O. Box 932300 Louisville, KY 40293-2300 |
If you don't have an EIN, you may apply for one online by visiting IRS.gov/EIN. If the principal business was created or organized outside of the United States or U.S. territories, you may also apply for an EIN by calling 267-941-1099 (toll call).
You may also apply for an EIN by faxing or mailing Form SS-4 to the IRS. If you haven't received your EIN by the due date of Form 945, file a paper return and write "Applied For" and the date you applied in this entry space.
Caution! If you're filing your tax return electronically, a valid EIN is required at the time the return is filed. If a valid EIN isn't provided, the return won't be accepted. This may result in penalties.
TIP. Always be sure the EIN on the form you file exactly matches the EIN the IRS assigned to your business. Don't use your social security number (SSN) or individual taxpayer identification number (ITIN) on forms that ask for an EIN. The name and EIN on Form 945 must match the name and EIN on your information returns where federal income tax withholding is reported (for example, backup withholding reported on Form 1099-NEC). Filing a Form 945 with an incorrect EIN or using another business's EIN may result in penalties and delays in processing your return.
Notify the IRS immediately if you change your business name, business address, or responsible party.
There are penalties for filing Form 945 late and for paying or depositing taxes late, unless filing and/or paying late is due to reasonable cause and not due to willful neglect. See section 11 of Pub. 15 for more information on deposit penalties. Interest is charged on taxes paid late at a rate set by law. There are also penalties for failure to file information returns (for example, Forms 1099-MISC, 1099-NEC, 1099-R, or W-2G) and for failure to furnish payee statements to payees.
If you receive a notice about a penalty after you file this return, reply to the notice with an explanation and we will determine if you meet reasonable-cause criteria. Don't attach an explanation when you file your return.
Use Form 843 to request abatement of assessed penalties or interest. Don't request abatement of assessed penalties or interest on Form 945 or Form 945-X.
Caution! If taxes that must be withheld (that is, trust fund taxes) aren't withheld or aren't deposited or paid to the U.S. Treasury, the trust fund recovery penalty may apply. The penalty is 100% of the unpaid trust fund tax. If these unpaid taxes can't be immediately collected from the employer or business, the penalty may be imposed on all persons who are determined by the IRS to be responsible for collecting, accounting for, or paying over these taxes, and who acted willfully in not doing so. For more information, see section 11 of Pub. 15.
States must allow unemployment compensation recipients to elect to have federal income tax withheld at a 10% rate. Recipients paid under the Railroad Unemployment Insurance Act may also elect withholding at a 10% rate.
Recipients of any of the following payments may request federal income tax withholding at a rate of 7%, 10%, 12%, or 22%.
The payee may request voluntary withholding on Form W-4V or you may develop your own substitute form. Any voluntary withholding on these payments must be reported on Form 945 (and on the required information return - Form 1099-DIV, Form 1099-G, Form SSA-1099, or Form RRB-1099) and is subject to the deposit rules.
Deposit all nonpayroll (Form 945) withheld federal income tax, including backup withholding, by EFT. Combine all Form 945 taxes for deposit purposes. Don't combine deposits for Forms 941, 943, 944, or CT-1 with deposits for Form 945. Also, don't combine Form 945 taxes with taxes for Forms 941, 943, 944, or CT-1 for purposes of determining any of the deposit rules discussed next, such as whether the $2,500 threshold is applicable, whether you're a monthly or semiweekly schedule depositor, or whether the $100,000 next-day deposit rule applies.
Generally, the deposit rules that apply to Form 941 also apply to Form 945. However, because Form 945 is an annual return, the rules for determining your deposit schedule (discussed below) are different from those for Form 941. See section 11 of Pub. 15 for a detailed discussion of the deposit rules.
TIP. If the total amount of tax for 2023 is less than $2,500, you're not required to make deposits during the year.
There are two deposit schedules - monthly and semiweekly - for determining when you deposit withheld federal income tax. These schedules tell you when a deposit is due after a tax liability arises (that is, you make a payment subject to federal income tax withholding, including backup withholding). Before the beginning of each calendar year, you must determine which of the two deposit schedules you're required to use.
For 2024, you're a monthly schedule depositor for Form 945 if the total tax reported on your 2022 Form 945 (line 3) was $50,000 or less. If the total tax reported for 2022 was more than $50,000, you're a semiweekly schedule depositor.
Caution! If you're a monthly schedule depositor and accumulate a $100,000 liability or more on any day during a calendar month, your deposit schedule changes on the next day to semiweekly for the remainder of the year and for the following year. For more information, see the $100,000 Next-Day Deposit Rule in section 11 of Pub. 15.
If you go out of business or end operations and you won't have to file Form 945 in the future, file a final return. Be sure to check the box on line A and enter the date that final nonpayroll payments were made. Also attach a statement to your return showing the name of the person keeping the payment records and the address where those records will be kept.
If you sell or transfer your business during the year, you and the new owner must each file a Form 945 for the year in which the transfer occurred. Report only the taxes you withheld.
When two businesses merge, the continuing firm must file a return for the year in which the change took place and the other firm should file a final return.
Changing from one form of business to another, such as from a sole proprietorship to a partnership or corporation, is considered a transfer. If a transfer occurs, you may need a new EIN. See Pub. 1635 and section 1 of Pub. 15 for more information.
Attach a statement to your return with all the following information.
If no sale or transfer occurred, or you don't know the name of the person to whom the business was sold or transferred, that fact should be included in the statement.
Enter dollars to the left of the preprinted line and cents to the right of it. Don't round entries to whole dollars. Always show an amount for cents, even if it is zero.
Enter the federal income tax that you withheld (or were required to withhold) from pensions (including distributions from tax-favored retirement plans, for example, section 401(k), section 403(b), and governmental section 457(b) plans), annuities, IRA distributions, military retirement, Indian gaming profits, and gambling winnings (regular gambling withholding only; backup withholding on gambling winnings is reported on line 2). Also enter any voluntary amount that you withheld on certain government payments, and on dividends and other distributions by an ANC.
Caution! Federal income tax withholding reported on Form W-2 must be reported on Form 941, Form 943, Form 944, or Schedule H (Form 1040), as appropriate.
Enter any backup withholding that you withheld (or were required to withhold), including backup withholding on gambling winnings. See part N in the General Instructions for Certain Information Returns for more information on backup withholding.
Regulated investment companies (RICs) and real estate investment trusts (REITs) must report any backup withholding on Form 945 in the year that the dividends are actually paid. This includes January payments of dividends declared during October, November, and December of the prior year. See the Instructions for Form 1099-DIV for special reporting requirements.
Add lines 1 and 2. If total taxes are $2,500 or more, the amount reported on line 3 must equal the total liability for the year reported on line 7M of the Monthly Summary of Federal Tax Liability, or line M of Form 945-A.
Enter your total Form 945 deposits for the year, including any overpayment that you applied from filing Form 945-X in 2023, and any overpayment that you applied from your 2022 return.
If line 3 is more than line 4, enter the difference on line 5. Otherwise, see Overpayment, later. You don't have to pay if line 5 is under $1. Generally, you should have a balance due only if your total taxes for the year (line 3) are less than $2,500. If you made payments under the accuracy of deposits rule, see section 11 of Pub. 15.
If you were required to make federal tax deposits, pay the amount shown on line 5 by EFT. If you weren't required to make federal tax deposits or you're a monthly schedule depositor making a payment under the accuracy of deposits rule (see section 11 of Pub. 15), you may pay the amount shown on line 5 by EFT, credit card, debit card, check, money order, or EFW. For more information on electronic payment options, go to IRS.gov/Payments.
If you pay by EFT, credit card, or debit card, file your return using the Without a payment address under Where To File, earlier. Don't file Form 945-V, Payment Voucher. If you pay by check or money order, make it payable to "United States Treasury." Enter your EIN, "Form 945," and "2023" on your check or money order. Complete Form 945-V and enclose with Form 945.
If line 3 is $2,500 or more and you deposited all taxes when due, the amount on line 5 should be zero.
Caution! If you didn't make deposits as required and instead pay the taxes with Form 945, you may be subject to a penalty.
What if you can't pay in full? top If you can't pay the full amount of tax you owe, you can apply for an installment agreement online.
You can apply for an installment agreement online if:
To apply using the Online Payment Agreement Application, go to IRS.gov/OPA.
Under an installment agreement, you can pay what you owe in monthly installments. There are certain conditions you must meet to enter into and maintain an installment agreement, such as paying the liability within 24 months, and making all required deposits and timely filing tax returns during the length of the agreement.
If your installment agreement is accepted, you will be charged a fee and you will be subject to penalties and interest on the amount of tax not paid by the due date of the return.
If line 4 is more than line 3, enter the difference on line 6. Never make an entry on both lines 5 and 6.
If you deposited more than the correct amount for the year, you can have the overpayment refunded or applied to your next return by checking the appropriate box. Check only one box below line 6. If you don't check either box or if you check both boxes, generally we will apply the overpayment to your next return. Regardless of any box you check or don't check on line 6, we may apply your overpayment to any past due tax account that is shown in our records under your EIN.
If line 6 is under $1, we will send a refund or apply it to your next return only if you ask us in writing to do so.
Caution! This is a summary of your monthly tax liability, not a summary of deposits made. If line 3 is less than $2,500, don't complete line 7 or Form 945-A.
Complete line 7 only if you were a monthly schedule depositor for the entire year and line 3 is $2,500 or more. See Determining Your Deposit Schedule, earlier.
Caution! The amount entered on line 7M must equal the amount reported on line 3.
Report your liabilities on Form 945-A instead of on line 7 if either of the following applies.
If you want to allow an employee, a paid tax preparer, or another person to discuss your Form 945 with the IRS, check the "Yes" box in the Third-Party Designee section of Form 945. Enter the name, phone number, and five-digit personal identification number (PIN) of the specific person to speak with - not the name of the firm that prepared your return. The designee may choose any five numbers as his or her PIN.
By checking "Yes," you authorize the IRS to talk to the person you named (your designee) about any questions we may have while we process your return. You also authorize your designee to do all of the following.
You're not authorizing your designee to bind you to anything (including additional tax liability) or to otherwise represent you before the IRS. If you want to expand the designee's authorization, see Pub. 947.
The authorization will automatically expire 1 year from the due date (without regard to extensions) for filing your Form 945. If you or your designee wants to terminate the authorization, write to the IRS office for your location using the Without a payment address under Where To File, earlier.
The following persons are authorized to sign the return for each type of business entity.
Form 945 may also be signed by a duly authorized agent of the taxpayer if a valid power of attorney has been filed.
Alternative signature method. top Corporate officers or duly authorized agents may sign Form 945 by rubber stamp, mechanical device, or computer software program. For details and required documentation, see Rev. Proc. 2005-39, 2005-28 I.R.B. 82, available at IRS.gov/irb/2005-28_IRB#RP-2005-39.
A paid preparer must sign Form 945 and provide the information in the Paid Preparer Use Only section if the preparer was paid to prepare Form 945 and isn't an employee of the filing entity. Paid preparers must sign paper returns with a manual signature. The preparer must give you a copy of the return in addition to the copy to be filed with the IRS.
If you're a paid preparer, enter your Preparer Tax Identification Number (PTIN) in the space provided. Include your complete address. If you work for a firm, enter the firm's name and the EIN of the firm. You can apply for a PTIN online or by filing Form W-12. For more information about applying for a PTIN online, go to IRS.gov/PTIN. You can't use your PTIN in place of the EIN of the tax preparation firm.
Generally, don't complete this section if you're filing the return as a reporting agent and have a valid Form 8655 on file with the IRS. However, a reporting agent must complete this section if the reporting agent offered legal advice, for example, advising the client on determining whether federal income tax withholding is required on certain payments.
Privacy Act and Paperwork Reduction Act Notice. top We ask for the information on Form 945 to carry out the Internal Revenue laws of the United States. We need it to figure and collect the right amount of tax. Sections 3402, 3405, and 3406 of the Internal Revenue Code require taxpayers to pay over to the IRS federal income tax withheld from certain nonpayroll payments and distributions, including backup withholding. Form 945 is used to report these withholdings. Section 6011 requires you to provide the requested information if the tax is applicable to you. Section 6109 requires you to provide your identification number. If you fail to provide this information in a timely manner, or provide false or fraudulent information, you may be subject to penalties.
You're not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law.
Generally, tax returns and return information are confidential, as required by section 6103. However, section 6103 allows or requires the IRS to disclose or give the information shown on your tax return to others described in the Code. For example, we may disclose your tax information to the Department of Justice for civil and criminal litigation, and to cities, states, the District of Columbia, and U.S. commonwealths and territories for use in administering their tax laws. We may also disclose this information to other countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism.
The time needed to complete and file Form 945 will vary depending on individual circumstances. The estimated average time is:
Recordkeeping............................... 5 hr., 58 min.
Learning about the law or the form.......... 24 min.
Preparing and sending the form to the IRS... 30 min.
If you have comments concerning the accuracy of these time estimates or suggestions for making Form 945 simpler, we would be happy to hear from you. You can send us comments from IRS.gov/FormComments. Or you can send your comments to the Internal Revenue Service, Tax Forms and Publications Division, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Don't send Form 945 to this address. Instead, see Where To File, earlier.