Eftps deposits vs W-2
I have been filing a quarterly 941 with fed tax witholding plus employer and employee fica taxes. I am a sole owner and employee of an S-Corp. I have suddenly encountered a problem that I don’t know how to solve.
I can’t seem to wrap it around my head to understand it. I make payments to EFTPS for 941’s under my employer ID number. Then I also make payments to eftps separately under my social security number. Since the 941 also asks for fed tax witholding to be added to the Fica taxes, am I duplicating payments when filing my 1040 because I also issue myself a W-2? I thought I was using EFTPS only to “hold” payments but
the 1040 side only has “estimated tax deposits” to check. On the 1040 there are two entries for taxes. One asks for w-2 taxes and the other asks for estimated taxes. I’m not sure how to co-ordinate these two entries. Please shed some light on this for me. Many Thanks, Eric R Wall.
The payments that you are making on behalf of the employer and employee (yourself) should all be filed and paid under your employer ID# (not social security #). It sounds like you are making the withholding payments under your personal social security # which is incorrect. In order for your S-Corp to receive credit, you must always file and pay all payroll taxes under the employer federal tax id#.
I recommend that you contact the IRS directly or consult with a payroll tax professional who can sort this out for you. You can search our National Bookkeeper Directory to find a local expert in your area.
Best of luck,
Crystalynn Shelton, CPA