1999 Department of the Treasury

Internal Revenue Service

Instructions for Form 945

Annual Return of Withheld Federal Income Tax
Section references are to the Internal Revenue Code unless otherwise noted.

Changes To Note ● Backup withholding

Report all income tax withholding from nonpayroll
New electronic deposit requirement. Beginning payments or distributions on one Form 945. Do not file
January 1, 2000, the following changes have been made more than one Form 945 for each calendar year.
to the electronic deposit requirement:
● The threshold that determines whether you must use
All income tax withholding reported on Forms 1099
(e.g., Form 1099-R or 1099-MISC) or Form W-2G must
the Electronic Federal Tax Payment System (EFTPS) has be reported on Form 945. Do not report income tax
been increased from $50,000 to $200,000. withholding on wages on Form 945. All employment taxes
● All Federal tax deposits (such as deposits for
and income tax withholding reported on Form W-2 must
employment tax, excise tax, and corporate income tax) be reported on Form 941 (or Form 943 for agricultural
made during a calendar year are combined to determine employees, Schedule H (Form 1040) for household
whether you exceeded the $200,000 threshold. If the total employees, or Form CT-1 for railroad employees).
of your Federal tax deposits made in 1998 exceeded Because distributions to participants from nonqualified
$200,000, you must use EFTPS beginning January 1, pension plans and some other deferred compensation
2000. arrangements are treated as wages and are reported on
● Participation in EFTPS is voluntary if your deposits do
Form W-2, income tax withheld from them must be
not exceed the new $200,000 threshold, even if you were reported on Form 941, not Form 945. See Circular E for
required to electronically deposit under the previous more information.
$50,000 threshold. However, businesses that exceed the Related publications. Circular E explains the rules for
new $200,000 threshold must continue to use EFTPS in withholding, depositing, and reporting Federal income tax.
all later years. Pub. 15-A, Employer's Supplemental Tax Guide, includes
● The waiver of the penalty for failure to use EFTPS,
information on income tax withholding from pensions and
scheduled to expire on July 1, 1999, has been extended annuities and Indian gaming profits. For information on
to January 1, 2000, for taxpayers whose total Federal tax withholding on gambling winnings, see the 2000
deposits in 1998 did not exceed the $200,000 threshold. Instructions for Forms W-2G and 5754. These
However, taxpayers will remain liable for penalties if a publications are available on the IRS's Internet Web Site
deposit is not made in the required manner. at www.irs.gov or by calling 1-800-TAX-FORM
For more information, see Circular E, Employer's Tax (1-800-829-3676).
Guide (Pub. 15). Who must file. If you withhold income tax (including
Threshold for deposit requirement increased from backup withholding) from nonpayroll payments, you must
$500 to $1,000. Beginning with your 1999 Form 945, if file Form 945. You are not required to file Form 945 for
your total taxes for the year (line 4) are less than $1,000, those years in which you do not have a nonpayroll tax
you are not required to make deposits. You may pay the liability. Do not report on Form 945 withholding that is
taxes with your Form 945. required to be reported on Form 1042, Annual
Withholding Tax Return for U.S. Source Income of
Photographs of Missing Children Foreign Persons.
The Internal Revenue Service is a proud partner with the When to file. For 1999, file Form 945 by January 31,
National Center for Missing and Exploited Children. 2000. However, if you made deposits on time in full
Photographs of missing children selected by the Center payment of the taxes for the year, you may file the return
may appear in instructions on pages that would otherwise by February 10. Your return will be considered timely filed
be blank. You can help bring these children home by if it is properly addressed and mailed First-Class or sent
looking at the photographs and calling 1-800-THE-LOST by an IRS designated delivery service on or before the
(1-800-843-5678) if you recognize a child. due date. See Circular E for more information on IRS
designated delivery services. If the due date for filing a
General Instructions return falls on a Saturday, Sunday, or legal holiday, you
may file the return on the next business day.
Purpose of form. Use Form 945 to report income tax Where to file. In the list below, find the location of your
withheld from nonpayroll payments. Nonpayroll payments legal residence, principal place of business, office, or
include the following: agency. Send your return to the Internal Revenue
● Pensions, annuities, and IRAs Service at the address listed for your location. No street
● Military retirement address is needed.
● Gambling winnings Note: Where you file depends on whether or not you are
● Indian gaming profits including a payment.
● Voluntary withholding on certain government payments

Cat. No. 20534D

Alabama, Louisiana, Mississippi North Carolina, Tennessee
Return without payment: Return with payment: Return without payment: Return with payment:
Austin, TX 73301-0042 P.O. Box 1213 Memphis, TN 37501-0042 P.O. Box 1213
Charlotte, NC 28201-1213 Charlotte, NC 28201-1213

Arizona South Carolina

Return without payment: Return with payment: Return without payment: Return with payment:
Austin, TX 73301-0042 P.O. Box 7749 Memphis, TN 37501-0042 P.O. Box 105092
San Francisco, CA 94120-7749 Atlanta, GA 30348-5092

Florida, Georgia Alaska, Colorado, Idaho, Montana, Nevada, Oregon,

Wyoming, Utah, Washington, California (ZIP Codes: 90053
Return without payment: Return with payment:
and 95660)
Austin, TX 73301-0042 P.O. Box 105092
Atlanta, GA 30348-5092 Return without payment: Return with payment:
Ogden, UT 84201-0042 P.O. Box 7749
New Mexico, Texas San Francisco, CA 94120-7749
Return without payment: Return with payment:
California (all other ZIP Codes), Hawaii
Austin, TX 73301-0042 P.O. Box 970018
St. Louis, MO 63197-0018 Return without payment: Return with payment:
Ogden, UT 84201-0042 P.O. Box 60000
Arkansas Los Angeles, CA 90060-6000
Return without payment: Return with payment:
If you have no legal residence or principal place of business
Cincinnati, OH 45999-0042 P.O. Box 1213
in any state
Charlotte, NC 28201-1213
All Returns:
Kentucky, Ohio, West Virginia Philadelphia, PA 19255-0005
Return without payment: Return with payment:
Cincinnati, OH 45999-0042 P.O. Box 5783
Chicago, IL 60680-5783
Employer identification number (EIN). If you do not
have an EIN, apply for one on Form SS-4, Application for
Employer Identification Number. Get this form by calling
New York (ZIP Codes: 11202 and 10008)
1-800-TAX-FORM (1-800-829-3676) or from the IRS's
Return without payment: Return with payment: Internet Web Site at www.irs.gov. If you do not have an
Cincinnati, OH 45999-0042 P.O. Box 1389 EIN by the time the return is due, write “Applied for” and
Newark, NJ 07101-1389 the date you applied in the space shown for the number.
Note: If you are reporting withholding on pension
New York (all other ZIP Codes), Connecticut, Maine, distributions, be sure to be consistent in using the same
Massachusetts, New Hampshire, Rhode Island, Vermont
name and EIN for all reporting and depositing of taxes
Return without payment: Return with payment: (e.g., on Forms 945, 1099-R, and 8109/EFTPS). Filing
Cincinnati, OH 45999-0042 P.O. Box 371441 Form 945 with an incorrect name and EIN or failure to use
Pittsburgh, PA 15250-7441 the same name and EIN in all reporting and depositing of
taxes may result in penalties and delays in processing
Illinois, Iowa, Kansas, Minnesota, Missouri, Oklahoma, your return.
Wisconsin
Penalties and interest. There are penalties for filing
Return without payment: Return with payment: Form 945 late and paying or depositing taxes late, unless
Kansas City, MO 64999-0042 P.O. Box 970019 there is reasonable cause. See section 11 of Circular E
St. Louis, MO 63197-0019 for more information on deposit penalties. There are also
penalties for failure to furnish information returns (e.g.,
Indiana, Michigan Form 1099-MISC, 1099-R, or W-2G) to payees and failure
Return without payment: Return with payment: to file copies with the IRS.
Kansas City, MO 64999-0042 P.O. Box 5783 There are penalties for willful failure to (1) file returns
Chicago, IL 60680-5783 and pay taxes when due or (2) deposit taxes when
required. There are also penalties for filing a false return
Nebraska, North Dakota, South Dakota or submitting bad checks. Interest is charged on taxes
Return without payment: Return with payment: paid late at the rate set by law. See Circular E for details.
Kansas City, MO 64999-0042 P.O. Box 7749 Caution: A trust fund recovery penalty may apply when
San Francisco, CA 94120-7749 income taxes that should be withheld are not withheld or
are not deposited or paid to the United States Treasury.
Delaware, District of Columbia, Maryland, New Jersey, Under this penalty, certain officers or employees of a
Pennsylvania, Virginia corporation, employees of a sole proprietorship, or
Return without payment: Return with payment: partners or employees of a partnership become personally
Memphis, TN 37501-0042 P.O. Box 1389 liable for payment of the taxes and are penalized an
Newark, NJ 07101-1389 amount equal to the unpaid taxes. This penalty may apply
when these unpaid taxes cannot be immediately collected
from the employer or business. The trust fund recovery
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penalty may be imposed on all persons who are The Electronic Federal Tax Payment System
determined by the IRS to be responsible for collecting, (EFTPS) must be used to make electronic deposits. If you
accounting for, and paying over these taxes, and who are required to make deposits by electronic funds transfer
acted willfully in not doing so. Willfully in this case means and fail to do so, you may be subject to a 10% penalty.
voluntarily, consciously, and intentionally. Taxpayers who are not required to make electronic
Voluntary income tax withholding. States must allow deposits may voluntarily participate in EFTPS. To enroll
unemployment compensation recipients to elect to have in EFTPS, call 1-800-555-4477 or 1-800-945-8400. For
Federal income tax withheld at a 15% rate. Recipients general information about EFTPS, call 1-800-829-1040.
paid under the Railroad Unemployment Insurance Act
may also elect withholding at 15%. In addition, recipients
of any of the following Federal payments may request Specific Instructions
Federal income tax withholding at a rate of 7%, 15%,
28%, or 31%: State code. If you made all your deposits with a Federal
● Social security and Tier 1 railroad retirement benefits
Reserve bank or authorized financial institution located in
the same state shown in your address on Form 945, do
● Certain crop disaster payments
not make an entry in the state code box. If you made all
● Commodity Credit Corporation loans these deposits in a state other than the state shown in
The payee may request withholding on Form W-4V, your address on Form 945, enter the Postal Service
Voluntary Withholding Request, or you may develop your two-letter abbreviation for the state where you made the
own form. Any voluntary withholding on these payments deposits in the state code box. If you made deposits in
must be reported on Form 945 (and on Form 1099–G) and more than one state, enter “MU” in the state code box.
is subject to the deposit rules. Final return. If you go out of business or end operations
and you will not be required to file Form 945 in the future,
file a final return. Be sure to mark the final return checkbox
Depositing Withheld Taxes and enter the date final income payments were made
Deposit all nonpayroll (Form 945) income tax withholding, above line 1.
including backup withholding, using Form 8109, Federal Line 1—Federal income tax withheld. Enter the income
Tax Deposit Coupon, at an authorized financial institution, tax you withheld from pensions, annuities, IRAs, military
unless you are required to use the EFTPS electronic retirement, Indian gaming profits, and gambling winnings
deposit system (see below). Combine all Form 945 taxes (regular gambling withholding only). Also enter any
for deposit purposes. Do not combine deposits for Form voluntary amount you withheld on certain government
941, 943, or CT-1 with deposits for Form 945. If you payments. If you are required to report income tax
deposit using Form 8109, be sure to mark the checkbox withholding on Forms 1099 (e.g., Form 1099-R) or Form
for Form 945 on Form 8109. W-2G, you must report the taxes withheld on Form 945.
Generally, the deposit rules that apply to Form 941 also Income tax withholding reported on Form W-2 must be
apply to Form 945. However, because Form 945 is an reported on Form 941, 943, or Schedule H (Form 1040),
annual return, the rules for determining your deposit as appropriate.
schedule (discussed below) are different from those for Line 2—Backup withholding. Enter any backup
Form 941. See section 11 of Circular E for a detailed withholding, including backup withholding on gambling
discussion of the deposit rules. winnings.
Determining your deposit schedule. There are two Regulated investment companies (RICs) and real estate
deposit schedules—monthly or semiweekly—for investment trusts (REITs) must report any backup
determining when you must deposit withheld income tax. withholding on Form 945 in the year the dividends are
These schedules tell you when a deposit is due after a tax actually paid. This includes January payments of
liability arises (i.e., you make a payment subject to income dividends declared during October, November, and
tax withholding, including backup withholding). Prior to the December of the prior year. (See the 2000 Instructions
beginning of each calendar year, you must determine for Form 1099–DIV for special reporting requirements.)
which of the two deposit schedules you must use. Line 3—Adjustment to correct administrative errors.
For 2000, you are a monthly schedule depositor for You cannot make an adjustment on Form 945 to correct
Form 945 if the total tax reported on your 1998 Form 945 income tax withholding or backup withholding reported in
was $50,000 or less. If the total tax reported for 1998 a prior calendar year unless it is to correct an
exceeded $50,000, you must deposit using the administrative error. An administrative error occurs if the
semiweekly schedule. amount you entered on Form 945 is not the amount you
Caution: If you are a monthly schedule depositor and actually withheld. For example, if the total income tax
accumulate a $100,000 liability or more on any day during actually withheld was incorrectly reported on Form 945
a calendar month, your deposit schedule changes to due to a math or transposition error, this is an
semiweekly for the remainder of the year and for the administrative error. The administrative error adjustment
following year. See section 11 of Circular E for more corrects the amount reported on Form 945 to agree with
information on the $100,000 next-day deposit rule. the amount actually withheld from nonpayroll payments.
Electronic deposit requirement. You must make You must report an adjustment to correct an
electronic deposits of all depository taxes that occur after administrative error on Form 945 in the year in which you
1999 if your total Federal tax deposits for 1998 were more discover the error. If the net adjustment is negative
than $200,000. See page 1 and Circular E for more (reducing your tax liability), enclose the amount reported
information. on line 3 in parentheses.

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 You will not be allowed a refund or credit for any prior Line 8—Monthly summary of Federal tax liability.
year overpayment of income tax that you withheld from a Note: This is a summary of your monthly tax liability, not
payee. This is because the payees use the amount of a summary of deposits made. If line 4 is less than $1,000,
withholding shown on the information return (e.g., Form do not complete line 8 or Form 945-A.
1099-R) as a credit when filing their income tax returns. Complete line 8 if you were a monthly schedule
If you are making an adjustment(s) to correct a prior depositor for the entire year. (See Determining your
year administrative error, report the net adjustment deposit schedule on page 3.)
(including adjustments to income tax withholding and Report your liabilities on Form 945-A instead of on line
backup withholding) on line 3. Complete Form 941c, 8 if:
Supporting Statement To Correct Information, or an ● You were a semiweekly schedule depositor during
equivalent statement, and file it with Form 945 to provide
1999. Do not complete entries A through M of line 8.
the required information on the adjustment(s). Be sure to
Instead, complete and file Form 945-A with Form 945.
identify the adjustment(s) in the supporting statement
● You were a monthly schedule depositor for 1999 and
(Part V of Form 941c) as correcting an administrative error
and provide a description of the error(s). Do not file Form during any month you accumulated nonpayroll taxes of
941c separately from Form 945. $100,000 or more. Because this converted you to a
semiweekly schedule depositor for the remainder of 1999
Reporting adjustments on line 8 or on Form 945-A.
and for 2000, you must report your liabilities on Form
The amount of the adjustment(s) also must be taken into
945-A for the entire year. Do not complete entries A
account in the monthly summary of Federal tax liability
through M of line 8. (See section 11 of Circular E for more
(line 8) or on Form 945-A, Annual Record of Federal Tax
information on the $100,000 next-day deposit rule.)
Liability. If the adjustment increases your tax liability,
include the adjustment with any other amount on the entry
space for the date you discovered the error. If the Privacy Act and Paperwork Reduction Act Notice.
adjustment decreases your tax liability, use the We ask for the information on this form to carry out the
adjustment amount as a credit to offset subsequent Internal Revenue laws of the United States. We need it to
liabilities on line 8 or Form 945-A until it is used up. (See figure and collect the right amount of tax. Sections 3402,
section 13 of Circular E for more information. The Circular 3405, and 3406 of the Internal Revenue Code require
E instructions for making adjustments refer to Form 941 taxpayers to pay over to the IRS income tax withheld from
but also apply to Form 945 adjustments.) certain nonpayroll payments and distributions, including
Note: If you are not required to complete line 8 or Form backup withholding. This form is used to determine the
945-A because your total taxes are less than $1,000, do amount of the taxes that you owe. Section 6011 requires
not show adjustments on line 8 or on Form 945-A. you to provide the requested information if the tax applies
Line 4—Total taxes. Add lines 1 and 2 and add or to you. Section 6109 requires you to provide your
subtract any net adjustment on line 3. If total taxes are employer identification number. Routine uses of this
$1,000 or more, the amount reported on line 4 must equal information include giving it to the Department of Justice
the total liability for the year reported on line 8M of the for civil and criminal litigation, and to cities, states, and the
Monthly Summary of Federal Tax Liability, or line M of District of Columbia for use in administering their tax laws.
Form 945-A. We may also give the information to other countries under
Line 5—Total deposits. Enter the total Form 945 a tax treaty. If you fail to provide this information in a
deposits for the year, including any overpayment applied timely manner, you may be subject to penalties and
from the prior year. interest.
Line 6—Balance due. You do not have to pay if line 6 You are not required to provide the information
is under $1. You should have a balance due only if your requested on a form that is subject to the Paperwork
total taxes for the year (line 4) are less than $1,000. Reduction Act unless the form displays a valid OMB
(However, see section 11 of Circular E regarding control number. Books or records relating to a form or its
payments made under the Accuracy of Deposits rule.) instructions must be retained as long as their contents
Enter your EIN, “Form 945”, and “1999” on your check or may become material in the administration of any Internal
money order and make it payable to the “United States Revenue law. Generally, tax returns and return
Treasury”. If line 4 is $1,000 or more and you deposited information are confidential, as required by section 6103.
all taxes when due, the amount on line 6 should be zero. The time needed to complete and file this form will vary
Caution: If you fail to make required deposits (using depending on individual circumstances. The estimated
EFTPS or Form 8109, as required) and instead pay these average time is: Recordkeeping, 5 hr., 59 min.; Learning
amounts with your return, you may be subject to a penalty. about the law or the form, 35 min.; and Preparing and
Line 7—Overpayment. If you deposited more than the sending the form to the IRS, 44 min. If you have
correct amount for the year, you can have the comments concerning the accuracy of these time
overpayment refunded or applied to your next return by estimates or suggestions for making this form simpler, we
checking the appropriate box. The IRS may apply your would be happy to hear from you. You can write to the
overpayment to any past due tax account under your EIN. Tax Forms Committee, Western Area Distribution Center,
If line 7 is under $1, we will send a refund or apply it to Rancho Cordova, CA 95743-0001. DO NOT send the tax
your next return only on written request. form to this address. Instead, see Where to file on page
1.

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