Wyoming Business Tips for Oct. 31-Nov. 6
A weekly look at Wyoming business questions from the Wyoming Small Business Development Center (WSBDC), part of WyomingEntrepreneur.Biz, a collection of business assistance programs at the University of Wyoming.
By Leonard Holler, WSBD regional director
"Do I have to use Electronic Federal Tax Payment System (EFTPS) to pay my payroll taxes to the IRS?" DeAnna, Casper.
It is probably not an option anymore. Previously, once the business's federal tax liability (including all taxes) during a calendar year exceeded $200,000 or the payroll tax deposits exceeded $50,000, a business owner was required to use EFTPS in the second succeeding calendar year.
But now, under a proposed rule from the U.S. Treasury (REG-153340-09), any business with a tax deposit requirement would have to make deposits electronically as of Jan. 1, 2011. The Financial Management Service (FMS), a bureau of the Treasury Department, beginning in 2011, is eliminating the system that enables the processing of Federal Tax Deposit (FTD) coupons.
Accordingly, these proposed regulations require the use of EFTPS for all FTDs, effective Jan. 1, which is not that far away. Designated federal taxes include employment taxes, corporate income taxes, social security taxes, FUTA tax, excise taxes and various other types of non-payroll withholding.
EFTPS is provided free by the U.S. Treasury Department for payment of federal taxes via the Internet or by calling. It is handled by a secure government Web site that uses the highest level of security. The system can only be accessed through a secure Internet browser with 128-bit encryption. When enrolling or gaining access to an account, you must provide three forms of unique information -- a taxpayer identity (EIN or SSN), EFTPS pin number and a password.
Once enrolled, business taxpayers can use the system to make all federal tax payments through the Internet or phone. On the Internet you can initiate a tax payment 24 hours a day, 7 days a week. A small business owner can also schedule tax payments up to 120 days in advance of a tax due date. It takes about two weeks after enrolling to receive an enrollment confirmation, so plan ahead.
For more information about enrolling in EFTPS, visit www.eftps.gov to get started.
A blog version of this article and an opportunity to post comments is available at http://www.wyomingentrepreneur.typepad.com/blog/.
The WSBDC is a partnership of the U.S. Small Business Administration, the Wyoming Business Council and the University of Wyoming. To ask a question, call 1-800-348-5194, e-mail firstname.lastname@example.org or write 1000 E. University Ave., Dept. 3922, Laramie, WY, 82071-3922.