In: Finance
Annie is a payroll clerk in Wilty Enterprises. She receives a written notice from the IRS that Wilty Enterprises is a monthly schedule depositor. How is the deposit schedule determined?
Multiple Choice
The payroll frequency used by the company.
The payroll tax liability during the lookback period.
The amount of FUTA taxes paid.
The number of employees in the company.
Answer: According to IRS document requirements section, a monthly schedule depositor is one who has reported employment taxes of $50,000 or less during the lockback period (time period used to measure how much taxes have been paid previously) and must deposit the reported taxes on payment made during a given month on or before 15th of the following month. Thus, deposit schedule is determined by the payroll tax liability, so correct option is '2' is 'The payroll tax liability during the lookback period'.