Pub 15-T

IRS pub 15-t is a tax publication that includes basic employment tax information. This article is an overview of the IRS Publication 15-t and covers everything you need to know about it.

Pub 15-T includes federal income tax withholding tables that employers use to figure the amount of taxes they must withhold on their employees’ wages. The publication also contains instructions on how to use the tables and information about withholding, depositing, reporting, and paying employment taxes.

Some fringe benefits aren’t taxable (or are minimally taxable). These include meals and lodging furnished on your business premises, the personal use of an automobile you provide, and some medical care reimbursements under a self-insured health plan. You may choose to treat certain taxable noncash fringe benefits as paid by the pay period, by the quarter, or on any other basis you like, as long as you do so at least once a year. However, you must deposit taxes in the same deposit period that you treat fringe benefits as paid to avoid a penalty.

The Internal Revenue Service has many convenient programs that can make filing and payment easier for you and your employees. You can rely on e-file and EFTPS to keep your business running smoothly. In addition, Publication 15-T provides specialized employment tax information that employers need to make the most of their business operations. It also provides a look at some of the changes that may affect businesses in the coming tax season.

The IRS has released Pub 15-T Federal Income Tax Withholding Methods (pdf) to explain formulas and tables used to figure federal income tax withholding. These are used by employers who pay wages subject to federal income tax withholding. It also explains the requirements for withholding, depositing, reporting, paying, and correcting employment taxes.

What are Federal Income Tax Withholding Methods
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What are Federal Income Tax Withholding Methods?

Federal income tax withholding methods are the rules for how much tax you withhold from an employee’s wages. They vary depending on how many allowances the employee claims on Form W-4, whether the allowances are on file for that employee, and whether you use online payroll software or do your taxes manually. The most common federal income tax withholding method is the percentage method, which calculates the FIT amount to withhold for each pay period by subtracting from gross income any supplemental wage payments that aren’t regular wages (e.g., bonuses, commissions, backpay retroactive pay increases, special payments).

Pub 15-T contains tables that show the percentage method tax rates for a variety of wage levels and other factors. It also shows the FIT amounts to withhold for different wage brackets and for employees who have dependents. However, this table only gives tax rates for wages up to around $100,000 annually. In addition, it doesn’t give any tax rates for employees who claim more than 10 allowances on their Form W-4.

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If you use this method, checking line 6 on the employee’s Form W-4 to see if they’re claiming additional withholding is important. In this case, you’ll need to add this amount to your tentative withholding amount. You’ll also need to make sure you’re using consistent rounding procedures for calculating the FIT amount. The IRS allows rounding to the nearest dollar, but consistency is important. If an employee provides you with a new Form W-4 claiming exemption from withholding on February 16 or later, you may apply the exemption to future wages but don’t refund any taxes you withheld while the exempt status wasn’t in place.

The amount you withhold from supplemental wages depends partly on whether the employee receives $1 million or more of them during the calendar year. If the supplemental wages are paid concurrently with regular wages, figure the total as if the two payments were a single payment for a regular payroll period. Supplemental wages can include tips and service charges, but you can choose to treat the latter as regular wages rather than supplemental wages. If you do, add the supplemental wages to the regular wages and withhold federal income tax on the entire amount by method 1b discussed earlier.

If you provide fringe benefits to your employees, value them using the same valuation rules you use for your other benefits. These include cars you provide, flights on aircraft you provide, free or discounted commercial flights, vacations, discounts on property or services, memberships in country clubs or other social clubs, and tickets to entertainment or sporting events.

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