For the latest information about developments related to Pub. 80, such as legislation enacted after it was published, go to IRS.gov/Pub80.

Social security and Medicare tax for 2023. The rate of social security tax on taxable wages, including qualified sick leave wages and qualified family leave wages paid in 2023 for leave taken after March 31, 2021, and before October 1, 2021, is 6.2% each for the employer and employee or 12.4% for both. Qualified sick leave wages and qualified family leave wages paid in 2023 for leave taken after March 31, 2020, and before April 1, 2021, aren't subject to the employer share of social security tax; therefore, the tax rate on these wages is 6.2%. The social security wage base limit is $160,200.The Medicare tax rate is 1.45% each for the employee and employer, unchanged from 2022. There is no wage base limit for Medicare tax.Social security and Medicare taxes apply to the wages of household workers you pay $2,600 or more in cash wages in 2023. Social security and Medicare taxes apply to election workers who are paid $2,200 or more in cash or an equivalent form of compensation in 2023.

Qualified small business payroll tax credit for increasing research activities. For tax years beginning before January 1, 2023, a qualified small business may elect to claim up to $250,000 of its credit for increasing research activities as a payroll tax credit. The Inflation Reduction Act of 2022 (the IRA) increases the election amount to $500,000 for tax years beginning after December 31, 2022. The payroll tax credit election must be made on or before the due date of the originally filed income tax return (including extensions). The portion of the credit used against payroll taxes is allowed in the first calendar quarter beginning after the date that the qualified small business filed its income tax return. The election and determination of the credit amount that will be used against the employer’s payroll taxes are made on Form 6765, Credit for Increasing Research Activities. The amount from Form 6765, line 44, must then be reported on Form 8974, Qualified Small Business Payroll Tax Credit for Increasing Research Activities.Starting in the first quarter of 2023, the payroll tax credit is first used to reduce the employer share of social security tax up to $250,000 per quarter and any remaining credit reduces the employer share of Medicare tax for the quarter. Any remaining credit, after reducing the employer share of social security tax and the employer share of Medicare tax, is then carried forward to the next quarter. Form 8974 is used to determine the amount of the credit that can be used in the current quarter. The amount from Form 8974, line 12 or, if applicable, line 17, is reported on Form 941, Form 941-SS, Form 943, or Form 944. For more information about the payroll tax credit, see IRS.gov/ResearchPayrollTC. Also see the line 16 instructions in the Instructions for Form 941-SS (line 17 instructions in the Instructions for Form 943; line 13 instructions in the Instructions for Form 944) for information on reducing your record of tax liability for this credit.

Forms 941-SS and 941-PR discontinued after 2023. Form 941-SS, Employer’s QUARTERLY Federal Tax Return—American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands, and Form 941-PR, Planilla para la Declaración Federal TRIMESTRAL del Patrono, will no longer be available after the fourth quarter of 2023. Instead, employers in the U.S. territories will file Form 941, Employer’s QUARTERLY Federal Tax Return, or, if you prefer your form and instructions in Spanish, you can file new Form 941 (sp), Declaración del Impuesto Federal TRIMESTRAL del Empleador.

Pubs. 80, 51, and 179 discontinued after 2023. Pub. 80; Pub. 51, Agricultural Employer's Tax Guide; and Pub. 179, Guía Contributiva Federal para Patronos Puertorriqueños, will no longer be available after 2023. Instead, information specific to employers in the U.S. territories and agricultural employers will be included in Pub. 15 beginning with the Pub. 15 for use in 2024 (published December 2023). Beginning in 2024, there will be a new Pub. 15 (sp) that is a Spanish-language version of Pub. 15.

The COVID-19 related credit for qualified sick and family leave wages is limited to leave taken after March 31, 2020, and before October 1, 2021. Generally, the credit for qualified sick and family leave wages as enacted under the Families First Coronavirus Response Act (FFCRA) and amended and extended by the COVID-related Tax Relief Act of 2020 for leave taken after March 31, 2020, and before April 1, 2021, and the credit for qualified sick and family leave wages under sections 3131, 3132, and 3133 of the Internal Revenue Code, as enacted under the American Rescue Plan Act of 2021 (the ARP), for leave taken after March 31, 2021, and before October 1, 2021, have expired. However, employers that pay qualified sick and family leave wages in 2023 for leave taken after March 31, 2020, and before October 1, 2021, are eligible to claim a credit for qualified sick and family leave wages in 2023. See the March 2023 revision of the Instructions for Form 941-SS, the 2023 Instructions for Form 944, or the 2023 Instructions for Form 943 for more information.

Payroll tax credit for certain tax-exempt organizations affected by qualified disasters. Section 303(d) of the Taxpayer Certainty and Disaster Tax Relief Act of 2020 allows for a payroll tax credit for certain tax-exempt organizations affected by certain qualified disasters not related to COVID-19. This credit is claimed on Form 5884-D (not on Form 941-SS, Form 944, or Form 943). Form 5884-D is filed after the Form 941-SS for the quarter, Form 944 for the year, or Form 943 for the year for which the credit is being claimed has been filed. For more information about this credit, go to IRS.gov/Form5884D.

Disaster tax relief. Disaster tax relief is available for those impacted by disasters. For more information about disaster relief, go to IRS.gov/DisasterTaxRelief.

Moving expense reimbursement. P.L. 115-97, Tax Cuts and Jobs Act, suspends the exclusion for qualified moving expense reimbursements from your employee's income for tax years beginning after 2017 and before 2026. However, the exclusion is still available in the case of a member of the U.S. Armed Forces on active duty who moves because of a permanent change of station due to a military order. The exclusion applies only to reimbursement of moving expenses that the member could deduct if he or she had paid or incurred them without reimbursement. See Moving Expenses in Pub. 3, Armed Forces' Tax Guide, for the definition of what constitutes a permanent change of station and to learn which moving expenses are deductible.

Work opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans. Qualified tax-exempt organizations that hire eligible unemployed veterans may be able to claim the work opportunity tax credit against their payroll tax liability using Form 5884-C. For more information, go to IRS.gov/WOTC.

Definition of marriage. A marriage of two individuals is recognized for federal tax purposes if the marriage is recognized by the state, possession, or territory of the United States in which the marriage is entered into, regardless of legal residence. Two individuals who enter into a relationship that is denominated as a marriage under the laws of a foreign jurisdiction are recognized as married for federal tax purposes if the relationship would be recognized as a marriage under the laws of at least one state, possession, or territory of the United States, regardless of legal residence. Individuals who have entered into a registered domestic partnership, civil union, or other similar relationship that isn't denominated as a marriage under the law of the state, possession, or territory of the United States where such relationship was entered into aren't lawfully married for federal tax purposes, regardless of legal residence.

Certification program for professional employer organizations (PEOs). The Stephen Beck, Jr., Achieving a Better Life Experience Act of 2014 required the IRS to establish a voluntary certification program for PEOs. PEOs handle various payroll administration and tax reporting responsibilities for their business clients and are typically paid a fee based on payroll costs. To become and remain certified under the certification program, certified professional employer organizations (CPEOs) must meet various requirements described in sections 3511 and 7705 and related published guidance. Certification as a CPEO may affect the employment tax liabilities of both the CPEO and its customers. A CPEO is generally treated for employment tax purposes as the employer of any individual who performs services for a customer of the CPEO and is covered by a contract described in section 7705(e)(2) between the CPEO and the customer (CPEO contract), but only for wages and other compensation paid to the individual by the CPEO. To become a CPEO, the organization must apply through the IRS Online Registration System. For more information or to apply to become a CPEO, go to IRS.gov/CPEO. Also see Revenue Procedure 2017-14, 2017-3 I.R.B. 426, available at IRS.gov/irb/2017-03_IRB#RP-2017-14.

Outsourcing payroll duties. Generally, as an employer, you're responsible to ensure that tax returns are filed and deposits and payments are made, even if you contract with a third party to perform these acts. You remain responsible if the third party fails to perform any required action. Before you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to a third-party payer, such as a payroll service provider or reporting agent, go to IRS.gov/OutsourcingPayrollDuties for helpful information on this topic. If a CPEO pays wages and other compensation to an individual performing services for you, and the services are covered by a contract described in section 7705(e)(2) between you and the CPEO (CPEO contract), then the CPEO is generally treated as the employer, but only for wages and other compensation paid to the individual by the CPEO. However, with respect to certain employees covered by a CPEO contract, you may also be treated as an employer of the employees and, consequently, may also be liable for federal employment taxes imposed on wages and other compensation paid by the CPEO to such employees. For more information on the different types of third-party payer arrangements, see section 16 of Pub. 15.

Aggregate filers. Approved section 3504 agents and CPEOs must complete Schedule R (Form 941), Allocation Schedule for Aggregate Form 941 Filers, when filing an aggregate Form 941 or, if applicable, a Schedule R (Form 943), Allocation Schedule for Aggregate Form 943 Filers, when filing an aggregate Form 943. Aggregate forms are filed by agents approved by the IRS under section 3504 of the Internal Revenue Code. To request approval to act as an agent for an employer, the agent files Form 2678 with the IRS unless you're a state or local government agency acting as an agent under the special procedures provided in Revenue Procedure 2013-39, 2013-52 I.R.B. 830, available at IRS.gov/irb/2013-52_IRB#RP-2013-39. Aggregate forms are also filed by CPEOs approved by the IRS under section 7705. To become a CPEO, the organization must apply through the IRS Online Registration System at IRS.gov/CPEO. CPEOs file Form 8973, Certified Professional Employer Organization/Customer Reporting Agreement, to notify the IRS that they've started or ended a service contract with a client or customer. CPEOs must generally file Form 941-SS, Schedule R (Form 941), Form 943, and Schedule R (Form 943) electronically. For more information about a CPEO's requirement to file electronically, see Revenue Procedure 2017-14, 2017-3 I.R.B. 426, available at IRS.gov/irb/2017-03_IRB#RP-2017-14. Other third-party payers that file aggregate forms, such as non-certified PEOs, must complete and file Schedule R (Form 941) or, if applicable, Schedule R (Form 943) if they have clients that are claiming any employment tax credit (for example, the qualified small business payroll tax credit for increasing research activities).

Residents of the Philippines working in the Commonwealth of the Northern Mariana Islands (CNMI). Employers must withhold and pay social security and Medicare taxes on wages and other compensation paid to residents of the Philippines who don’t hold an H-2 status for services performed as employees in the CNMI after December 31, 2014, unless those workers are eligible for exemption from social security and Medicare taxes under an exception listed in section 12. For more information, see Announcement 2012-43, 2012-51 I.R.B. 723, available at IRS.gov/irb/2012-51_IRB#ANN-2012-43.

CNMI government employees are subject to social security and Medicare taxes. Beginning in the fourth calendar quarter of 2012, CNMI government employees are subject to social security and Medicare taxes.

Federal employers in the CNMI. The U.S. Treasury Department and the CNMI Division of Revenue and Taxation entered into an agreement under 5 U.S.C. section 5517 in December 2006. Under this agreement, all federal employers (including the Department of Defense) are required to withhold CNMI income taxes (rather than federal income taxes) and deposit the CNMI taxes with the CNMI Treasury for employees who are subject to CNMI taxes and whose regular place of federal employment is in the CNMI. For more information, including details on completing Form W-2, go to IRS.gov/5517Agreements. Federal employers are also required to file quarterly and annual reports with the CNMI Division of Revenue and Taxation. For questions, contact the CNMI Division of Revenue and Taxation.

You must receive written notice from the IRS to file Form 944. If you’ve been filing Forms 941-SS and believe your employment taxes for the calendar year will be $1,000 or less, and you would like to file Form 944 instead of Forms 941-SS, you must contact the IRS during the first calendar quarter of the tax year to request to file Form 944. You must receive written notice from the IRS to file Form 944 instead of Forms 941-SS before you may file this form. For more information on requesting to file Form 944, including the methods and deadlines for making a request, see the Instructions for Form 944.

Employers can request to file Forms 941-SS instead of Form 944. If you received notice from the IRS to file Form 944 but would like to file Forms 941-SS instead, you must contact the IRS during the first calendar quarter of the tax year to request to file Forms 941-SS. You must receive written notice from the IRS to file Forms 941-SS instead of Form 944 before you may file these forms. For more information on requesting to file Forms 941-SS, including the methods and deadlines for making a request, see the Instructions for Form 944.

Change of business address or responsible party. Notify the IRS immediately if you change your business address or responsible party. Complete and mail Form 8822-B to notify the IRS of a business address or responsible party change. For a definition of “responsible party,” see the Instructions for Form SS-4.

Federal tax deposits must be made by electronic funds transfer (EFT). You must use EFT to make all federal tax deposits. Generally, an EFT is made using the Electronic Federal Tax Payment System (EFTPS). If you don't want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. Also, you may arrange for your financial institution to initiate a same-day wire payment on your behalf. EFTPS is a free service provided by the Department of the Treasury. Services provided by your tax professional, financial institution, payroll service, or other third party may have a fee. For more information on making federal tax deposits, see How To Deposit in section 8.For more information about EFTPS or to enroll in EFTPS, go to EFTPS.gov or call 800-555-4477. To contact EFTPS using Telecommunications Relay Services (TRS) for people who are deaf, hard of hearing, or have a speech disability, dial 711 and then provide the TRS assistant the 800-555-4477 number above or 800-733-4829. Additional information about EFTPS is also available in Pub. 966.

Electronic filing and payment. Using electronic options can make filing a return and paying your federal tax easier. Use EFTPS to make deposits or pay in full, whether you rely on a tax professional or prepare your own taxes. You can use IRS e-file to file certain returns. If there is a balance due on the return, you can e-file and e-pay in a single step by authorizing an electronic funds withdrawal (EFW) from your bank account while e-filing. Don't use EFW to pay taxes that are required to be deposited. Go to IRS.gov/EmploymentEfile for more information on filing electronically. For more information on paying your taxes using EFW, go to IRS.gov/EFW. A fee may be charged to file electronically.

.If you’re filing your tax return or paying your federal taxes electronically, a valid employer identification number (EIN) is required at the time the return is filed or the payment is made. If a valid EIN isn't provided, the return or payment won't be processed. This may result in penalties. See section 1 for information about applying for an EIN..

Electronic option for filing Forms W-2AS, W-2CM, W-2GU, or W-2VI. Employers in American Samoa, the CNMI, Guam, and the U.S. Virgin Islands can use the Social Security Administration's (SSA's) W-2 Online service to create, save, print, and submit up to 50 Forms W-2AS, W-2CM, W-2GU, or W-2VI at a time over the Internet. If you use the SSA's Form W-2 Online service, Form W-3SS will be generated automatically based on your Forms W-2AS, W-2CM, W-2GU, or W-2VI. For more information, go to the SSA's website at SSA.gov/bso.

Credit or debit card payments. You can pay the balance due shown on your employment tax return by credit or debit card. Your payment will be processed by a payment processor who will charge a processing fee. Don't use a credit or debit card to make federal tax deposits. For more information on paying your taxes with a credit or debit card, go to IRS.gov/PayByCard.

Online payment agreement. You may be eligible to apply for an installment agreement online if you can’t pay the full amount of tax you owe when you file your employment tax return. For more information, see the instructions for your employment tax return or go to IRS.gov/OPA.

Dishonored payments. Any form of payment that is dishonored and returned from a financial institution is subject to a penalty. The penalty is $25 or 2% of the payment, whichever is more. However, the penalty on dishonored payments of $24.99 or less is an amount equal to the payment. For example, a dishonored payment of $18 is charged a penalty of $18.

Hiring new employees. Record the number and name from each new employee's social security card. An employee who doesn't have a social security card should apply for one on Form SS-5, Application for a Social Security Card. See section 3.

Reporting discrepancies between Forms 941-SS (or Form 944) and Forms W-2. File Schedule D (Form 941), Report of Discrepancies Caused by Acquisitions, Statutory Mergers, or Consolidations, to explain certain wage, tax, and payment discrepancies between Forms 941-SS (or Form 944) and Forms W-2 that were caused by acquisitions, statutory mergers, or consolidations. For more information, see the Instructions for Schedule D (Form 941).

Apply for an employer identification number (EIN) online. Go to IRS.gov/EIN to apply for an EIN online.

Private delivery services. You can use certain private delivery services (PDSs) designated by the IRS to meet the “timely mailing as timely filing” rule for tax returns. Go to IRS.gov/PDS for the current list of PDSs. The PDS can tell you how to get written proof of the mailing date.For the IRS mailing address to use if you're using a PDS, go to IRS.gov/PDSstreetAddresses. Select the mailing address listed on the webpage that is in the same state as the address to which you would mail returns filed without a payment, as shown in the instructions for your employment tax return. . PDSs can't deliver items to P.O. boxes. You must use the U.S. Postal Service to mail any item to an IRS P.O. box address..

Recordkeeping. Keep all records of employment taxes for 4 years. These should be available for IRS review.There is no required format for such records, but they should include your EIN; the amounts and dates of all wage payments (including fringe benefits) and tips reported; the names, addresses, and occupations of employees receiving such payments and their social security numbers (SSNs); copies of returns filed; dates of employment; and the dates and amounts of deposits made. Keep documentation to substantiate any employment tax credits claimed. Records related to qualified sick leave wages and qualified family leave wages for leave taken after March 31, 2021, and before October 1, 2021, and records related to qualified wages for the employee retention credit paid after June 30, 2021, should be kept for at least 6 years. For more information on substantiation requirements, go to IRS.gov/PLC and IRS.gov/ERC, respectively. Also keep documentation to substantiate the amount of any employer or employee share of social security tax that you deferred and paid for 2020. Farm employers must keep a record of the name, permanent address, and EIN of each crew leader. See Farm Crew Leaders in section 2.

Disregarded entities and qualified subchapter S subsidiaries (QSubs). Eligible single-owner disregarded entities and QSubs are treated as separate entities for employment tax purposes. Eligible single-member entities must report and pay employment taxes on wages paid to their employees using the entities' own names and EINs. See Regulations sections 1.1361-4(a)(7) and 301.7701-2(c)(2)(iv).

Pub. 5146 explains employment tax examinations and appeal rights. Pub. 5146 provides employers with information on how the IRS selects employment tax returns to be examined, what happens during an exam, and what options an employer has in responding to the results of an exam, including how to appeal the results. Pub. 5146 also includes information on worker classification issues and tip exams.

Photographs of missing children. The IRS is a proud partner with the National Center for Missing & Exploited Children® (NCMEC). Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

The following are important dates and responsibilities. The dates listed here haven’t been adjusted for Saturdays, Sundays, and legal holidays (see the TIP next). Pub. 509, Tax Calendars (for use in 2023), adjusts the dates for Saturdays, Sundays, and legal holidays. See section 8 for information about depositing taxes reported on Forms 941-SS, 943, and 944. See section 11 for information about depositing FUTA tax. Due dates for forms required for health coverage reporting aren’t listed here. For these dates, see Pub. 509.

.If any date shown next for filing a return, furnishing a form, or depositing taxes falls on a Saturday, Sunday, or legal holiday, the due date is the next business day. The term "legal holiday" means any legal holiday in the District of Columbia. A statewide legal holiday delays a filing due date only if the IRS office where you’re required to file is located in that state. However, a statewide legal holiday doesn't delay the due date of federal tax deposits. See Deposits Due on Business Days Only in section 8. For any filing due date, you’ll meet the “file” or “furnish” requirement if the envelope containing the return or form is properly addressed, contains sufficient postage, and is postmarked by the U.S. Postal Service on or before the due date, or sent by an IRS-designated PDS on or before the due date. See Private delivery services under Reminders, earlier, for more information..

Fiscal year taxpayers. The due dates listed next apply whether you use a calendar or a fiscal year.

Introduction

This publication is for employers whose principal place of business is in the U.S. Virgin Islands, Guam, American Samoa, or the CNMI, or who have employees who are subject to income tax withholding for any of these jurisdictions. Employers and employees in these areas are generally subject to social security and Medicare taxes under the Federal Insurance Contributions Act (FICA). See section 6 and section 7 for more information. This publication summarizes employer responsibilities to collect, pay, and report these taxes.

Whenever the term “United States” is used in this publication, it includes the U.S. Virgin Islands, Guam, American Samoa, and the CNMI.

This publication also provides employers in the U.S. Virgin Islands with a summary of their responsibilities in connection with the tax under the Federal Unemployment Tax Act, known as FUTA tax. See section 11 for more information.

Except as shown in the table in section 12, social security, Medicare, and FUTA taxes apply to every employer who pays taxable wages to employees or who has employees who report tips.

This publication doesn't include information relating to the self-employment tax (for social security and Medicare of self-employed persons). See Pub. 570, Tax Guide for Individuals With Income From U.S. Possessions, if you need this information.

This publication also doesn't include information relating to income tax withholding. In the U.S. Virgin Islands, Guam, American Samoa, and the CNMI, contact your local tax department for information about income tax withholding. See Pub. 15 for information on U.S. federal income tax withholding and Pub. 15-T for the U.S. federal income tax withholding tables.

1. Employer Identification Number (EIN)

An EIN is a nine-digit number that the IRS issues. Its format is 00-0000000. It is used to identify the tax accounts of employers and certain other organizations and entities that have no employees. Use your EIN on all of the items that you send to the IRS and the SSA for your business.

If you don't have an EIN, you may apply for one online by going to IRS.gov/EIN. You may also apply for an EIN by faxing or mailing Form SS-4 to the IRS. If the principal business was created or organized outside of the United States or U.S. territories, you may also apply for an EIN by calling 267-941-1099 (toll call). Don't use an SSN in place of an EIN.

If you don't have an EIN by the time a return is due, file a paper return and enter “Applied For” and the date that you applied for it in the space shown for the number. If you took over another employer's business, don't use that employer's EIN.

You should have only one EIN. If you have more than one, write to the IRS office where you file your returns using the “without a payment” address in the instructions for your employment tax return. Or call the IRS Business & Specialty Tax Line at 800-829-4933. Persons who are deaf, hard of hearing, or have a speech disability (TDD/TTY users) may call 800-829-4059. The IRS will tell you which EIN to use. For more information, see Pub. 1635.

.Always be sure the EIN on the form you file exactly matches the EIN the IRS assigned to your business. Don't use your SSN or individual taxpayer identification number (ITIN) on forms that ask for an EIN. If you used an EIN (including a prior owner's EIN) on Form 941-SS, Form 944, or Form 943 that is different from the EIN reported on Form W-3SS, see Box h—Other EIN used this year in the General Instructions for Forms W-2 and W-3..

2. Who Are Employees?

Generally, employees are defined either under common law or under special statutes for certain situations. See Pub. 15-A for details on statutory employees and nonemployees.

3. Employee's Social Security Number (SSN)

An employee's SSN consists of nine digits separated as follows: 000-00-0000. You must get each employee's name and SSN and enter them on Form W-2AS, W-2CM, W-2GU, or W-2VI. If you don't report the employee's correct name and SSN, you may owe a penalty unless you have reasonable cause. See Pub. 1586 for information on the requirement to solicit the employee's SSN.

4. Wages and Other Compensation

Generally, all wages are subject to social security and Medicare tax (and FUTA tax for U.S. Virgin Islands employers). However, wages subject to social security tax and FUTA tax are limited by a wage base amount that you pay to each employee for the year. The wage base for social security tax is $160,200 for 2023. After you pay $160,200 to an employee in 2023, including tips, don't withhold social security tax on any amount that you later pay to the employee for the year. The wage base for FUTA tax is $7,000 for 2023. All wages are subject to Medicare tax. The wages may be in cash or in other forms, such as an automobile for personal use. Wages include salaries, vacation allowances, bonuses, commissions, and fringe benefits. It doesn't matter how payments are measured or paid.

See the table in section 12 for exceptions to social security, Medicare, and FUTA taxes on wages. See section 5 and section 6 for a discussion of how the rules apply to tips and farmworkers.

Social security and Medicare taxes apply to most payments of sick pay, including payments by third parties such as insurance companies. Special rules apply to the reporting of third-party sick pay. For details, see Pub. 15-A.

Determine the value of noncash pay (such as goods, lodging, and meals) by its fair market value. However, see Fringe Benefits, later. Except for farmworkers and household employees, this kind of pay may be subject to social security, Medicare, and FUTA taxes.

Back pay, including retroactive wage increases (but not amounts paid as liquidated damages), is taxed as ordinary wages in the year paid. For information on reporting back pay to the SSA, see Pub. 957.

.For purposes of this publication, all references to “sick pay” mean ordinary sick pay, not “qualified sick leave wages” under the FFCRA, as amended by the COVID-related Tax Relief Act of 2020, and the ARP..

5. Tips

Cash tips that your employee receives from customers are generally subject to social security and Medicare tax withholding. Your employee must report cash tips to you by the 10th of the month after the month that the tips are received. Cash tips include tips paid by cash, check, debit card, and credit card. The report should include tips you paid over to the employee for charge customers, tips the employee received directly from customers, and tips received from other employees under any tip-sharing arrangement. Both directly and indirectly tipped employees must report tips to you. The report shouldn't include tips that the employee paid out to other employees. No report is required for months when tips are less than $20. Your employees report tips on Form 4070 or on a similar statement. They may also use Form 4070A to keep a record of their tips. Both forms are included in Pub. 1244 available at IRS.gov.

The statement must be signed and dated by the employee and must include:

.You’re permitted to establish a system for electronic tip reporting by employees. See Regulations section 31.6053-1(d)..

The withholding rules for withholding an employee's share of Medicare tax on tips also apply to withholding the Additional Medicare Tax once wages and tips exceed $200,000 in the calendar year.

6. Social Security and Medicare Taxes for Farmworkers

The tests described next apply only to services that are defined as agricultural labor (farmwork). In general, you’re an employer of farmworkers if your employees:

For this purpose, the term “farm” includes stock, dairy, poultry, fruit, fur-bearing animal, and truck farms, as well as plantations, ranches, nurseries, ranges, greenhouses or other similar structures used primarily for the raising of agricultural or horticultural commodities, and orchards.

Farmwork doesn't include reselling activities that don't involve any substantial activity of raising agricultural or horticultural commodities, such as a retail store or a greenhouse used primarily for display or storage. It also doesn’t include processing services which change a commodity from its raw or natural state, or services performed after a commodity has been changed from its raw or natural state.

A “share farmer” working for you isn't your employee. However, the share farmer may be subject to self-employment tax. In general, share farming is an arrangement in which certain commodity products are shared between the farmer and the owner (or tenant) of the land. For details, see Regulations section 31.3121(b)(16)-1.

7. How To Figure Social Security and Medicare Taxes

The tax rate for social security is 6.2% (amount withheld) each for the employer and employee (12.4% total). The social security wage base limit is $160,200. The tax rate for Medicare is 1.45% (amount withheld) each for the employee and employer (2.9% total). There is no wage base limit for Medicare tax; all covered wages are subject to Medicare tax. Multiply each wage payment by these percentages to figure the tax to withhold from employees. Employers report both the employee and employer shares on Form 941-SS, Form 944, or Form 943 (farm employment). See section 5 for information on tips.

.Qualified sick leave wages and qualified family leave wages for leave taken after March 31, 2020, and before April 1, 2021, aren't subject to the employer share of social security tax; therefore, the tax rate on these wages is 6.2%. Qualified sick leave wages and qualified family leave wages for leave taken after March 31, 2021, and before October 1, 2021, are subject to both the employer share (6.2%) and employee share (6.2%) of social security tax (12.4% total)..

8. Depositing Taxes

.If an employer is eligible to claim a credit for qualified sick and family leave wages during 2023, the employer can reduce their deposits by the amount of their anticipated credit. Employers won't be subject to a failure-to-deposit (FTD) penalty for properly reducing their deposits if certain conditions are met. For more information on reducing deposits, see Notice 2020-22, 2020-17 I.R.B. 664, available at IRS.gov/irb/2020-17_IRB#NOT-2020-22; and Notice 2021-24, 2021-18 I.R.B. 1122, available at IRS.gov/irb/2021-18_IRB#NOT-2021-24; and the instructions for your employment tax return. For more information about the credit for qualified sick and family leave wages, go to IRS.gov/PLC..

Generally, you must deposit social security and Medicare taxes if your tax liability (Form 941-SS, line 12; Form 944, line 9; or Form 943, line 13) is $2,500 or more for the tax return period. You must make the deposit by EFT. For more information about EFTs, see How To Deposit, later in this section.

9. Employer's Returns

10. Wage and Tax Statements

By January 31, 2023, furnish Copies B and C of 2022 Form W-2AS, W-2CM, W-2GU, or W-2VI to each employee. If an employee stops working for you during the year, furnish the statement at any time after employment ends but no later than January 31 of the next year. However, if the employee asks you for Form W-2, furnish it within 30 days of the request or the last wage payment, whichever is later.

If you go out of business during the year, give your employees their Forms W-2 by the due date of your final Form 941-SS. File Copy A with the SSA by the last day of the month after that due date.

If an employee loses or destroys his or her copies, furnish that employee copies of Form W-2AS, W-2CM, W-2GU, or W-2VI marked “REISSUED STATEMENT.” Don't send Copy A of the reissued form to the SSA.

File Copy A of all Forms W-2AS, W-2CM, W-2GU, and W-2VI with Form W-3SS, Transmittal of Wage and Tax Statements, with the SSA by January 31, 2023.

.Employers in the CNMI should contact their local tax department for instructions on completing Form W-2CM. You can get Form W-2CM and its instructions by going to Finance.gov/mp/forms.php, or by calling 670-664-1000..

.When reconciling Forms W-2 and W-3 to Form 941-SS, 944, or 943 for 2022, you should consider that paid qualified sick leave wages and qualified family leave wages for leave taken after March 31, 2020, and before April 1, 2021, aren't subject to the employer share of social security tax..

11. Federal Unemployment (FUTA) Tax—U.S. Virgin Islands Employers Only

The Federal Unemployment Tax Act (FUTA), with state unemployment systems, provides for payments of unemployment compensation to workers who have lost their jobs. Most employers pay both a federal and a state unemployment tax. Only the employer pays FUTA tax; it isn't withheld from your employees' wages. For more information, see the Instructions for Form 940.

You must file Form 940 if you’re subject to FUTA tax under the following rules.

13. Federal Agency Certifying Requirements of Federal Income Taxes Withheld From U.S. Government Employees and Federal Pension Recipients

Special Certifying Requirements for Federal Agencies

This section sets forth the legal authorities requiring federal agencies to certify to the IRS the amount of federal income taxes withheld from amounts paid to U.S. Government employees working in, as well as federal civilian and military pensioners residing in, American Samoa, the Commonwealth of the Northern Mariana Islands (CNMI), and Guam. As noted below, these special certifying requirements don't apply to federal agencies who have employees working in Puerto Rico or the U.S. Virgin Islands.

“Federal Income Taxes” From American Samoa, the CNMI, or Guam

This section describes what “federal income taxes” are subject to these certification procedures.

For purposes of these cover over certification requirements, the term “federal income taxes” includes federal income taxes that have been withheld from compensation and other amounts paid to and deposited into the U.S. Treasury on any of the following.

Certification Procedures

This section contains the procedures federal agencies must follow to certify to the IRS the amount of “federal income taxes” paid to and deposited into the U.S. Treasury. All departments and agencies of the federal government (as well as service and social organizations associated with a military or civilian federal entity) that withhold federal income taxes on amounts paid to employees and pensioners of the United States (or any agency thereof) as provided herein must certify to the IRS each calendar quarter the total amount of federal income taxes withheld that have been deposited into the U.S. Treasury. Federal agencies must submit a separate certification for federal income taxes creditable to American Samoa, the CNMI, and Guam, as applicable.

Except as provided below, these certifications should be in the form of a letter and should include:

A federal government department or agency that submits a certification on behalf of another department or agency must include the name and EIN of each subordinate or designated federal department or agency included, along with the required data for each subordinate or designated department or agency. In this instance, the certifying agency must send the certification at least on an annual basis, no later than February 14.

In addition, federal government agencies certifying for compensation paid to military personnel not stationed in American Samoa, the CNMI, or Guam but who have a state of legal residence in one of these territories must provide each servicemember’s name, social security number, amount of annual salary paid, and total amount of annual federal income tax withheld.

The amounts shown in the certification must agree with the amounts of federal income tax withheld and reported on the quarterly federal tax return(s) of the agency (Form 941).

Federal agencies must submit these certifications on a quarterly basis no later than 45 days after the close of each calendar quarter as follows:

Federal agencies should mail this certification to the following address:

Internal Revenue Service
Revenue Systems and Analysis
Attn: OS:CFO:FM:RA:S (77K St)
1111 Constitution Ave NW
CFO/FM - Mail Stop 6167
Washington, DC 20224
Fax: 202-803-9691

How To Get Tax Help

If you have questions about a tax issue; need help preparing your tax return; or want to download free publications, forms, or instructions, go to IRS.gov to find resources that can help you right away.

. Getting answers to your tax questions. On IRS.gov, you can get up-to-date information on current events and changes in tax law..

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Although the tax preparer always signs the return, you're ultimately responsible for providing all the information required for the preparer to accurately prepare your return. Anyone paid to prepare tax returns for others should have a thorough understanding of tax matters. For more information on how to choose a tax preparer, go to Tips for Choosing a Tax Preparer on IRS.gov.