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 wsbdc@uwyo.edu or write 1000 E. University Ave., Dept. 3922, Laramie, WY, 82071-3922.
