EFTPS.For fiscal year 1999, Sec. 6302(h) requires 94% of employment and other depository The place where a deposit is placed and kept, e.g., a bank, savings and loan institution, credit union, or trust company. A place where something is deposited or stored as for safekeeping or convenience, e.g., a safety deposit box. taxes to be collected by the electronic funds transfer See EFT. (application, communications) electronic funds transfer - (EFT, EFTS, - system) Transfer of money initiated through electronic terminal, automated teller machine, computer, telephone, or magnetic tape. payment $50,000 or more. Now, proposed regulations (NPRM (Notice of Proposed Rule Making) An announcement by an agency of the U.S. government that proposes a change in regulations. It is followed up by a final ruling. REG-100729-98, 3/23/99) increase the deposit threshold to $200,000 in aggregate Federal tax deposits during a calendar year. The increase will allow small businesses to transition to the EFT eft: see newt. (Electronic Funds Transfer) The transfer of money from one account to another by computer. See ACH. EFT - electronic funds transfer system at their own pace. Initially, the new threshold would be applied to 1998 deposits. Depositors that exceed the 1998 threshold would have to make EFT deposits in 2000 and subsequent years. Depositors that first exceed the threshold in 1999 or later would be required to use EFT after a one-year grace period. Depositors exceeding the threshold would not be allowed to resume making paper coupon deposits if they fall below the $200,000 threshold in a subsequent year. Depositors currently required to deposit by EFT would be granted a fresh Start and would not have to use EFT unless they exceed the $200,000 threshold in 1998 or thereafter. Under the new rules, only 9% of all businesses making Federal tax deposits would have to deposit by EFT. The fresh start would allow 65% of the depositors currently subject to the EFT requirement to resume making paper coupon deposits beginning in 2000. Current regulations prescribe one threshold ($50,000 in employment taxes) for depositors liable for employment taxes and a separate threshold ($50,000 in other taxes) for depositors with no employment tax liability. Thus, persons who deposit employment taxes (but do not exceed the applicable $50,000 threshold) are not subject to the EFT requirement, even if they deposit large amounts of other depository taxes. The proposed rules adopt an aggregate deposits test that would be simpler and easier to administer than the two-threshold test, and eliminate the anomalous current treatment of depositors that deposit small amounts of employment taxes and large amounts of other taxes. The current regulations allow the voluntary payment by EFT of certain nondepository taxes (e.g., individual income taxes and estimated taxes Federal and state tax laws require a quarterly payment of estimated taxes due from corporations, trusts, estates, non-wage employees, and wage employees with income not subject to withholding. ). The proposed regulations expand the types of nondepository tax payments for which voluntary payment by EFT is allowed to include nondepository payments of Federal income, estate and gift, employment and various specified excise taxes excise taxes, governmental levies on specific goods produced and consumed inside a country. They differ from tariffs, which usually apply only to foreign-made goods, and from sales taxes, which typically apply to all commodities other than those specifically exempted. . A public hearing on the proposals will be held on May 11, 1999. Interested parties have until May 24, 1999, to submit written comments to: IRS Attn: CC:DOM:CORP:R (REG-100729-98) PO Box 7604 Ben Franklin Station Room 5226 Washington, DC 20044 In addition, ILK-99-27 notes that the IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. will continue to waive To intentionally or voluntarily relinquish a known right or engage in conduct warranting an inference that a right has been surrendered. For example, an individual is said to waive the right to bring a tort action when he or she renounces the remedy provided by law for such penalties for most smaller businesses required to use EFTPS EFTPS Electronic Federal Tax Payment System EFTPS Electronic Funds Transfer Payment System if they make timely deposits using paper deposit coupons; penalty relief will run from July 1-Dec. 31, 1999. However, penalties will be imposed on taxpayers currently required to use EFTPS if their aggregate deposits exceeded $200,000 during 1998 and they do not use EFTPS for deposits due beginning on July 1,1999. For EFTPS information or to obtain an enrollment form, call (800) 555-4477 or (800) 945-8400. Taxpayers can begin using EFTPS as soon as they receive their payment instruction packet and personal identification number. For IRS guidance on the waiver of penalties for certain EFT deposits, see "Tax Trends" p. 362, this issue.3 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion