Instructions for Form CT-1 X - Introductory Material


Future Developments

For the latest information about developments related to Form CT-1 X and its instructions, such as legislation enacted after they were published, go to www.irs.gov/ct1x.

What's New

Employee consents to support a claim for refund.   Notice 2015-15 provides guidance to employers on the requirements for employee consents used by an employer to support a claim for refund of overcollected Railroad Retirement Tax Act (RRTA) taxes. The notice and proposed revenue procedure clarifies the basic requirements for a request for a consent and for the employee consent itself, and permits a consent to be requested, furnished, and retained in an electronic format as an alternative to a paper format. The notice also requests comments and contains guidance concerning what constitutes “reasonable efforts” if a consent is not secured to permit the employer to claim a refund of the employer share of overcollected RRTA taxes. For more information, see Notice 2015-15, 2015-9 I.R.B. 687, available at www.irs.gov/irb/2015-9_IRB/ar07.html.

Retroactive increase in excludible transit benefits.   The Tax Increase Prevention Act of 2014 increased the monthly transit benefit exclusion from $130 per participating employee to $250 per participating employee for the period of January 1, 2014, through December 31, 2014. Employers were provided instructions on how to correct the social security and Medicare taxes on the excess transit benefits in Notice 2015-2, 2015-4 I.R.B. 334, available at www.irs.gov/irb/2015-4_IRB/ar06.html.

Reminders

Correcting Tier 1 Employee Additional Medicare Tax withholding.   Beginning in 2013, compensation (including tips) and sick pay subject to Tier 1 Employee Additional Medicare Tax withholding are reported on Form CT-1, lines 6 and 12. Any errors discovered on a previously filed Form CT-1 are corrected on Form CT-1 X, lines 11 and 17. For more information about Tier 1 Employee Additional Medicare Tax withholding, see the Instructions for Form CT-1 and go to IRS.gov and enter “Additional Medicare Tax” in the search box. See the instructions for lines 11 and 17, later, for more information on the types of errors that can be corrected and how the correction is reported on Form CT-1 X.

Tier 1 Employee tax rate for 2011 and 2012.   In 2011 and 2012, the Tier 1 Employee tax rate was 4.2% and Tier 1 Employer tax rate was 6.2% (10.4% total). Be sure to use the correct rate when reporting corrections on lines 9 and 15.

Period of limitations to make certain corrections expired.   Generally, you may correct overreported taxes on a previously filed Form CT-1 if you file Form CT-1 X within 3 years of the date Form CT-1 was filed or 2 years from the date you paid the tax reported on Form CT-1, whichever is later. For purposes of the period of limitations, Form CT-1 is considered filed on the last day in February of the succeeding year if filed before that date.

  The period of limitations to correct the qualified employer's Tier 1 tax exemption for 2010 and the qualified employer's Tier 1 tax credit for 2010 expired on February 28, 2014, for most employers. The lines formerly used for these corrections were removed from Form CT-1 X. If the period of limitations for any of these corrections is still open, you will need to file the February 2013 revision of Form CT-1 X. The February 2013 revision of Form CT-1 X is available on IRS.gov.


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