IRS to eliminate paper coupon deposits

The Internal Revenue Service (IRS) has issued proposed regulations to significantly increase the number of electronic transactions between taxpayers and the federal government.

The proposed regulations (REG 153340-09) would eliminate the rules for making federal tax deposits by paper coupon because the paper coupon system will no longer be maintained by the Treasury Department after Dec. 31, 2010. The proposed regulations generally maintain existing rules for depositing federal taxes through the Electronic Federal Tax Payment System (EFTPS).

The following types of taxes are affected:

1. Corporate income and corporate estimated taxes pursuant to § 1.6302-1
2. Unrelated business income taxes of tax-exempt organizations under section 511 pursuant to § 1.6302-1
3. Private foundation excise taxes under section 4940 pursuant to § 1.6302-1
4. Taxes withheld on nonresident aliens and foreign corporations pursuant to § 1.6302-2
5. Estimated taxes on certain trusts pursuant to § 1.6302-3
6. FICA taxes and withheld income taxes pursuant to § 31.6302-1
7. Railroad retirement taxes pursuant to § 31.6302-2
8. Nonpayroll taxes, including backup withholding pursuant to § 31.6302-4
9. Federal Unemployment Tax Act (FUTA) taxes pursuant to § 31.6302(c)-3
10. Excise taxes reported on Form 720, Quarterly Federal Excise Tax Return, pursuant to § 40.6302(c)-1

The proposed regulations do not alter existing de minimus rules for employers with a deposit liability of less than $2,500 for a return period who are allowed to pay their employment taxes with their quarterly or annual tax return.

Using EFTPS to make federal tax deposits enables depositors to make tax payments 24 hours a day, seven days a week from any locatoin. The EFTPS system allows taxpayers to schedule payment dates up to 120 days advance of the desired payment date.

Information on EFTPS, including how to enroll, can be found at www.eftps.gov or by calling EFTPS Customer Service at 1-800-555-4477.

Comments will be accepted on the proposed regulations through Septemer 22, 2010. Comments can be submitted electronically. A public hearing on the proposed regulations will be held at the IRS building in Washington, D.C. on September 21, 2010.

 

You may like these other stories...

President Obama squeezed under the bar for the highest marginal tax rate on the federal income tax return he recently filed for 2013. But the Commander in Chief, who filed a joint return, couldn't dodge the new 3.8...
IRS audits less than 1 percent of big partnershipsAccording to an April 17 report from the Government Accountability Office (GAO), the IRS audits fewer than 1 percent of large business partnerships, Stephen Ohlemacher of the...
Legislation coming out of Washington just might reduce homeowners' burden for disaster insurance. It's a topic very much on everyone's minds since the mudslide in Oso, Washington. The loss of human life was...

Upcoming CPE Webinars

Apr 22
Is everyone at your organization meeting your client service expectations? Let client service expert, Kristen Rampe, CPA help you establish a reputation of top-tier service in every facet of your firm during this one hour webinar.
Apr 24
In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
Apr 25
This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.
Apr 30
During the second session of a four-part series on Individual Leadership, the focus will be on time management- a critical success factor for effective leadership. Each person has 24 hours of time to spend each day; the key is making wise investments and knowing what investments yield the greatest return.