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Part 3. Submission Processing

Chapter 11. Returns and Documents Analysis

Section 13. Employment Tax Returns (Cont. 2)

3.11.13  Employment Tax Returns (Cont. 2)

3.11.13.22 
Form 944, Return Perfection and Line Editing

3.11.13.22.12  (01-01-2008)
Perfecting Line 13 and Form 945-A

  1. Perfect line 13 or Form 945-A as follows:

    IF THEN
    There is a negative or minus (-) amount which has been subtracted on Form 944 , lines 13a through 13l or Form 945-A, Step 1 - "X" (Line through) the section containing the negative or minus amount.

    Note:

    If a negative or minus is found on Form 945-A, "X" (line through) the entire Form 945-A.


    Step 2 - Enter SIC 1.
    The taxpayer has completed both, lines 13a through 13m and Form 945-A, DO NOT CROSS OUT ANY ENTRIES, unless they are negative or minus entries. ISRP will pick up both Form 944, line 13 and Form 945-A entries. Master File will determine the correct entry.

    Note:

    Enter SIC 1 only if both Form 944, line 13 and Form 945-A are not to be entered (both have areas that contain negative entries).
    The taxpayer completes more than one Form 945-A, Combine the Daily Tax Liabilities from each Form 945-A to one Form 945-A and "X" (line through) the Forms 945-A that are not to be entered.
    Form 944, line 13a through 13l are blank but Form 945-A has only monthly amounts, Step 1 - Edit the monthly totals from Form 945-A to the applicable monthly line(s) of the ROFTL on Form 944.
    Step 2 - "X" (line through) (Delete) Form 945-A.
    The taxpayer does not complete the ROFTL area if Form 944, but completes an attachment in the same format as the ROFTL or the Form 945-A, Put the attachment or Form 945-A immediately behind the Form 944. Do not write the taxpayers figures in the ROFTL area.
       
    Form 945-A shows an entry for a day which is not in that month (i.e. an entry for February 29th, and it is not leap year), Step 1 - "X" (line through) the entry.
    Step 2 - Enter the amount to the last valid day of February.
    Step 3 - If an entry already exists in the field, add the amounts together. "X" the taxpayer's entry and enter the result to the left of the "X" . (An exception would be more than one entry on the same line, add figures together, "X" the figures on the left, and put the total to the left of the "X" ).

3.11.13.22.13  (01-01-2008)
Line 14, State Deposit Code (Domestic and 944-PR Only)

  1. See IRM 3.11.13.12.7 for processing procedures for the State Deposit Code box and See Exhibit 3.11.13-22 for a list of State Deposit Codes.

3.11.13.22.14  (01-01-2008)
Line 15, "Final Return" Check Box, and"Final Date You Paid Wages"

  1. If the taxpayer has checked the "If your business has closed and you do not have to file returns in the future" box, edit a CCC F.

  2. If the taxpayer indicates in another location on the return, or in an attachment, that the return being filed is their final return with a notation such as (but not limited to) Final, Out of Business, No Longer Have Employees, Deceased, Liquidation, Dissolved, etc. then the "Final Return" box on line 15 should be checked and a date when final wages were paid should have been provided.

    Note:

    Do not edit CCC F, if the date of Final Wages is after the last day of the return's tax period.

  3. If the taxpayer did not check the box, the Code and Edit examiner should check the box and edit a CCC F in the designated location.

  4. If the taxpayer did not provide a date when final wages were paid, and the return shows tax data, then correspond for the Date of Final Wages. Otherwise, if the return shows no tax data, DO NOT correspond for the Date of Final Wages.

3.11.13.22.15  (01-01-2008)
♦Paid Preparer SSN or PTIN♦

  1. The preparer's SSN or PTIN is located at the bottom-right corner on page 2 of the return.

  2. The Prepare's SSN must be a nine-digit numeric number and cannot be all zeros or all nines.

  3. A Preparer Tax Identification Number (PTIN) is a nine-digit number beginning with the alpha "P" (i.e. PXXXXXXXX).

  4. Circle out the Preparer's SSN or PTIN if it is invalid. No other editing is required.

3.11.13.22.16  (01-01-2008)
♦Paid Preparer EIN (Firm's EIN)♦

  1. The Preparer's EIN is located in page 2 of the return in the bottom-right corner.

  2. The Prepare's (Firm's) EIN must be a nine-digit number and cannot be all zeros or all nines.

  3. Circle out the Preparer's EIN if it is invalid. No other editing is required.

3.11.13.23  (01-01-2008)
Form 945, Annual Return of Withheld Federal Income Tax - General

  1. Form 945 is used to report income tax withheld from non-payroll payments. Non-payroll payments include the following:

    • Backup withholding

    • Pensions and annuities,

    • IRAs,

    • Military retirement,

    • Gambling winnings,

    • Withholding on government payments,

    • Indian Gaming Revenues Distributed to Tribal Members.

  2. Certain companies (such as, life insurance companies) sell annuity contracts to participants in "non-qualified" plans (for example, Section 457 plans). Generally, distribution from these contracts are payments of deferred wages, reportable on a Form W–2 and subject to wage withholding. These annuity contracts must be filed on a Form 941 return, not on Form 945. If it can be determined that a Form 941 should have been filed, correspond with the taxpayer explaining that it was wages from a deferred plan subject to wage withholding and must be reported on Form 941.

  3. If Form 945 is received with sick pay information on the return, send the return back to taxpayer requesting clarification. (Sick pay is not reported on Form 945.)

  4. All Forms 945 must correspond to the current revision. If a prior year form is received:

    1. Renumber the lines on the prior year revision to the current revision, or

    2. Overlay the prior year revision with the current format.

      Note:

      Form 945 returns filed that do not have an indication of taxes owed should not be sent to Entity to have filing requirements set.

  5. Domestic and Foreign consideration of Forms 945:

    1. Domestic -
      • Form 945: Employers whose principle place of business is in the U.S.
      • Form 945: with a foreign (international) address that is not in the 50 state or the District of Columbia (OSPC ONLY - FOREIGN ADDRESS ONLY)

  6. Foreign Return Processing:

    1. All Forms 945, with a foreign address or an address of an American possession should be processed at the Ogden Submission Processing Campus (OSPC). If these returns are received in any other Submission Processing Campus, they must be transshipped to OSPC. Army Post Office (APO) and Fleet Post Office (FPO) are not considered foreign addresses.
      • If the return is unnumbered, withdraw it from the batch and prepare Form 13195 requesting the Letter 86C be sent to the taxpayer. Attach a Form 4227 for routing to OSPC.
      • If the return is numbered, use AC 650.

    2. Otherwise, the instructions provided for the regular returns (i.e. Form 945 returns filed with foreign or American possession addresses) should be followed to the extent possible to process these returns.

    3. Do not send these returns back for missing signature on Form 6800-A or Notice 695. Instead, initiate letter 21C.

  7. Form 945 returns which have been early filed before the end of the tax year, (e.g. tax year 2007 returns filed on or before December 31, 2007) must be held until the first cycles of the next year (2008). Use Action Code 480.

  8. When a Form 941C is attached to a Form 945 return, it is not necessary to route the Form 941C to Accounts Management. Form 941C correcting other that Form 945, process as follows:

    IF THEN
    The Form 941C is correcting a form other than Form 945, Step 1 - Notate on the Form 945 right margin,"Form 941C with Form 945 appears to be correcting information other than a Form 945" .
    Step 2 - Photocopy the Form 945, all pertinent information, and the Form 941C.
    Step 3 - Forward the photocopies to Accounts Management (Adjustments).

3.11.13.23.1  (01-01-2008)
Perfecting Form 945 Returns

  1. Form 945 will be edited using normal editing procedures. See Exhibit 3.11.13-13 for the transcription lines.

  2. Enter all money amounts in DOLLARS AND CENTS unless directed otherwise.

  3. Perfect for validity only. All alpha words must be written in numeric format.

    Note:

    It is not necessary to convert notations of "none" ,"zero" or "blank" to a numeric equivalent.

  4. Any transaction lines which are not legible or incorrect, should be corrected by placing an "X" to the left of the entry

  5. If a pre-computed FTD penalty is shown on the return, edit the penalty amount in the right margin above the "If address is different from prior return..." box.

  6. Finalizing Form 945: If the taxpayer has checked the "If you do not have to file returns in the future" box, or has indicated in another location on the return or attachments that the return is a final, process as follows:

    IF AND THEN
    Date of final wages present, Falls within the tax period being filed for, Edit CCC F.
    Date is after the last day of the tax period being filed for, DO NOT edit CCC F.
    No Date of final wages present, Return shows tax data, Correspond for the date of final wages.
    Return shows no tax data, Edit CCC F.

  7. Edit CCC "P" on a current year period return when the return has the unique identifier of "(77)" in the top left margin next to the literal "Internal Revenue Service" . See Figure 3.11.13-92

    Figure 3.11.13-92

    This image is too large to be displayed in the current screen. Please click the link to view the image.

    Form 945 Requiring editing of CCC P

3.11.13.23.2  (01-01-2008)
Line 1, Federal Income Tax Withheld from pensions, annuities, gambling winnings, etc.

  1. The taxpayer will report the total of income tax that was withheld on pensions, annuities, IRAs, military retirement, certain government payments, Indian Gaming Revenues Distributed to Tribal Members, and gambling winnings.

  2. Ensure all entries are numeric and in dollars and cents. If the taxpayer enters dollars only, accept taxpayers entries.

  3. Line 1 can be blank, zero, or any amount.

3.11.13.23.3  (01-01-2008)
Line 2, Backup withholding

  1. The taxpayer will report any backup withholding, including backup withholding on gambling.

  2. Ensure all entries are numeric and in dollars and cents. If the taxpayer enters dollars only, accept taxpayers entries.

  3. Line 2 can be blank, zero, or any amount.

3.11.13.23.4  (01-01-2008)
Line 3, Adjustment to Correct Administrative Errors

  1. Entries on line 3 can be positive, negative or minus amounts.

  2. Adjustments can be made to prior years Income Tax Withholding as long as the Statute of Limitations has not expired. See IRM 3.11.13.16.4 for barred period processing.

  3. Processing a Decrease in Income Tax Withholding as follows:

    IF AND THEN
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ The taxpayer has NOT provided a Form 941C or supporting statement, or there is no explanation for the adjustment, Accept taxpayer's entry and continue to process the return. Accept taxpayer's entry with parenthesis.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Edit CCC C on the return and continue processing. . Refer to IRM 3.11.13.16.7, Form 941C Exception Processing.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ The taxpayer has provided a Form 941C or supporting statement, or there is not explanation for the adjustment, Verify the line 3 amount against the attached Form 941C.
    See IRM 3.11.13.16 for verification procedures for Part II, Income Tax Withholding (including Backup Withholding) Adjustment of Form 941C.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  4. Processing an Increase in Income Tax Withholding - Accept any increase whether or not a Form 941C, supporting statement, or explanation is attached. If a Form 941C is attached, verify that the correct entry is shown on line 3 of the return. See IRM 3.11.13.16.4 for barred period processing.

  5. EXCEPTION PROCESSING After an adjustment has been taken on line 3, line 4 cannot be less than zero.

    IF THEN
    A negative or minus entry on line 3 results in line 4 being less than zero (e.g. a negative or minus entry) Review the attachments for a Form 941C (or equivalent statement) to ensure that the adjustment qualifies as an administrative error (or description qualifies as an administrative error). See IRM 3.11.13.16.2 for administrative errors verification.
    A Form 941C (or equivalent statement) is attached Step 1 - "X" line(s) 3 and 4.
    Step 2 - Enter on line 3 an amount that would result in line 4 equaling zero. Enter zero on line 4.
    Step 3 - Prepare Form 3465, Request for Adjustment, and advise Accounts Management (Adjustments) that "Administrative Error-Tax reduced to zero on (enter year). Remainder needs to be adjusted on a prior year"
    Step 4 - Photocopy the Form 945, (Form 941C, or if any, an equivalent statement) and attach it to the Form 3465.
    Step 5 - Route to Accounts Management (Adjustments). Notate on the left margin of the original Form 945, "F3465 to AM–Adm Error" Continue processing the return.

  6. The Exception Processing in (5) for line 3 may need to be taken into account on line 8, or on Form 945-A, Annual Record of Tax Liability if it increases the taxpayer's liability. The taxpayer should show these adjustments in the corresponding space for the date the error was discovered. If the space for that date shows another entry, combine the adjustment and the entry and enter the new total.

  7. A taxpayer may make an adjustment(s) to correct a prior administrative error by reporting the net adjustment (of income tax withholding and backup withholding) on line 3. Accept taxpayer's entry if reported with parenthesis.

3.11.13.23.5  (01-01-2008)
Line 4, Total Taxes

  1. This line represents the total taxes reported on the return. If line 1, 2, or 3 contains an entry, there should be an entry on line 4. Process line 4 as follows:

    IF THEN
    Line 4 is blank and there are amounts on lines 1, 2 and 3, Add lines 1 through 3. Enter the result on line 4.
    Line 1, 2, 3 and 4 are blank and there is an entry on line 8M, Edit the amount on line 8M to both lines 1 and 4.
    Line 4 has an amount and lines 1, 2 and 3 are blank, zero, or "none" , Double arrow line 4 to line 1.
    Line 4 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Edit SIC 1. The taxpayer does not need to complete line 8M or Form 945-A.

3.11.13.23.6  (01-01-2008)
Line 5, Total Deposits, line 6, Balance Due, and line 7, Overpayment

  1. Perfect line(s) 5, 6, or 7 as follows:

    IF THEN
    Line 5 is less than line 4 and line 6 is blank, Compute line 6.
    Line 5 is less than line 4, and there are entries on lines 6 and 7, "X" the entry on line 7.
    Line 5 is more than line 4, and there are entries on lines 6 and 7, "X" the entry on line 6.
    Line 5 is blank, or if you are unable to determine which entry between lines 6 or 7 is correct, Do not edit.
    The entry on line 6 belongs on line 7, and the taxpayer indicates they expect a refund by indicating parenthesis or brackets around the amount on line 6, indicating a minus (-) after the amount, or by checking the "Refund" box or "Applied to Next Return" box below line 6, Arrow line 6 to line 7.
    Line 4 and 5 are the same, "X" any entries on line(s) 6 or 7

3.11.13.23.7  (01-01-2008)
Line 8, Monthly Summary of Federal Tax Liability and Form 945-A (ROFTL)- Schedule Indicator Code (SIC)

  1. When line 4, Total Taxes, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , the taxpayer is required to complete a Record of Federal Tax Liability (ROFTL). Depending on their tax liability reported for previous years, the taxpayer will complete Form 945, line 8 or Form 945-A, Annual Record of Federal Tax Liability. The taxpayer will indicate between lines 7 and 8 which ROFTL they are to complete.

  2. The Schedule Indicator Code (SIC) is used to notify the computer that the ROFTL is blank, unnecessary, incomplete, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ or that a penalty should not be assessed.

  3. If a SIC needs to be entered on the return, edit the applicable SIC in the right margin at the end of Line A "If you do not have to file..." (Form 945).

    SCHEDULE INDICATOR CODE (SIC) CHART
    If more than one code is applicable, enter the codes in this priority order: 1 and 2.
    SIC CODE CONDITIONS
    1 1. Line 4 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ and ROFTL is blank or incomplete, (i.e. Form 945, line 8 or Form 945-A, line M)
    2. Line 4 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ .
    3. If the return shows all zeros or is non-taxable.
    4. A negative or minus (-) amount appears in the ROFTL (Form 945, line 8A through M, or Form 945-A, lines A through M) and has been subtracted from any monthly total. Note: If the taxpayer completed both the ROFTL (line 8) and Form 945-A, only edit SIC 1 if both (i.e. line 8 and the Form 945-A) are not to be entered by ISRP.
    5. Return is prepared under IRC 6020(b).
    6. If there is a difference ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ between line 4 and the total liability for the year, (i.e. line 8M or Form 945-A, line M.)
    Note: If line 15M or Form 945-A, line M is less than the tolerance, do not edit SIC "1" .
    2 SIC 2 will no longer be edited, if the taxpayer requests abatement for Failing to Pay Timely when the return is submitted. Send 1382C letter, which will inform the taxpayer of the proper procedure to follow to request abatement, if, and when a penalty is assessed.
    In the cases of disaster, the examiners will be provided with coding procedures.

3.11.13.23.8  (01-01-2008)
Perfecting Line 8 and Form 945-A

  1. If line 4≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , lines 8A through M or Form 945-A do not need to be completed

  2. If line 4 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ , perfect line 8 or Form 945-A as follows:

    IF THEN
    There is a negative or minus (-) amount which has been subtracted on Form 945, line 8A through 8M, or Form 945-A, "X" (line through) Lines 8A through 8M Form 945 or Form 945-A containing the negative or minus (-) amount and edit a SIC 1 (If there is no ROFTL to enter).
    Note: If a negative or minus amount is found on Form 945-A, "X" (line through) the entire Form 945-A.
    The taxpayer has completed both Form 945, lines 8A through 8M and Form 945-A, DO NOT CROSS OUT ANY ENTRIES. (unless they are negative or minus entries.) ISRP will pick up both (Form 945, line 8 and Form 945-A) entries and Master File will determine the correct entry.
    Note: Enter a SIC 1 only if both the Form 945, line 8A through 8M, and the Form 945-A are not to be entered.
    The taxpayer completes more than one Form 945-A, Combine the Daily Tax Liabilities from each Form 945-A to one Form 945-A and "X" (line through) the Forms 945-A that are not to be entered.
    Form 945, lines 8A through 8M are blank but Form 945-A has only monthly amounts, Step 1 - Draw an arrow across line 8A through 8L pointing to the right.
    Step 2 - On the Form 945-A edit the numbers from line 8A through 8L next to the monthly amounts.
    The taxpayer does not complete the ROFTL area of Form 945, but completes an attachment in the same format as the ROFTL or the Form 945-A, Put the attachment or Form 945-A immediately behind the Form 945. Do not write the taxpayer figures in the ROFTL area.
    Form 945, line 8A through 8L are entered, but line 8M is blank, Total the lines 8A through 8L. Then, enter the result on line 8M.
    Form 945-A shows an entry for a day which is not in that month, e.g. an entry for February 29th, and it is not a leap year, Step 1 - "X" (line through) the entry.
    Step 2 - Enter the amount to the last valid day the month.
    Step 3 - If an entry already exists in the field, add the amounts together. "X" the taxpayer's entry and enter the new amount. (An exception would be more than one entry on the same line, add the figures together and put the total to the left of the line.
    The taxpayer indicates they are a semi-weekly depositor, (for example checks the semi-weekly box above line 8) and line 4 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ but a completed Form 945-A (or facsimile) is not attached to determine the correct amounts, Step 1 - Correspond with the taxpayer to determine their intent.
    Step 2 - If no reply, edit SIC 1.

  3. Combine multiple deposits shown on the same line and enter the correct amount to the left of the "X" .

3.11.13.24  (01-01-2008)
Form CT-1, Employer's Annual Railroad Retirement Tax Return (CSPC only)

  1. Form CT-1, Employer's Annual Railroad Retirement Tax Return, processing is performed only at the Cincinnati Submission Processing Campus (CSPC). If any Form CT-1 returns are received at any other campus, transship to CSPC.

  2. The tax reported on Form CT-1 represents the Social Security/Medicare tax for railroad employees. Prior to January 1, 2002, employers were also responsible for paying a Supplemental Annuity Work Hour tax. However, legislation was passed eliminating the Supplemental Annuity Work Hour tax for year 2002 and subsequent. See Exhibit 3.11.13-14 for current year Form CT-1 transcription lines.

  3. All editing is done on the return using normal editing procedures.

  4. Edit all fields in DOLLARS AND CENTS, unless otherwise directed.

  5. Edit any FTD penalty amount in the right margin above the "If final return..." box.

  6. If Form CT-1 is received with a Form 8275-R (Regulation Disclosure Statement) attached:

    1. Photocopy the CT–1 and Form 8275-R.

    2. Route the photocopies to Compliance (Examination). They will forward the photocopies to the appropriate Territorial Office.

    3. Code and Edit will process the original return.

3.11.13.24.1  (01-01-2008)
Examining Form CT-1 Return Data

  1. The return format on all returns (e.g. unnumbered and numbered) must correspond to the current year's format.

    1. To convert the return to the current format, you must renumber the lines on a prior revision to the current format. See the table below for the conversion line numbers and special procedures.

      If line(s) number was: (Revision 2001 and prior) ... THEN
      1, 2, 3 or 4 Step 1 - Delete the line by drawing a line through the line number.
      Step 2 - Complete renumbering the line numbers of the return. If line 4, Adjusted total of Supplemental Annuity tax, (Revision 2001 and prior) shows an amount (or it can be computed from entries on lines 1, 2, and 3), enter the amount to the right on line 12, revision 2002 and subsequent. Also, do not enter CCC C if line 12 was blank before the line 4 entry.
      Step 3 - If the taxpayer filed the CT-1 with an entry on new line 12, add this amount to the amount shown on line 4 (Revision 2001 and prior) and enter this total amount on new line 12. If there is no supporting explanation for the initial line 12 adjustment, edit CCC C. Also send a copy of the return to the Railroad Retirement Board.
      5 1
      6 2
      7 3
      8 4
      9 5
      10 6
      11 7
      12 8
      13 9
      14 10
      15 11
      16 12
      17 Delete the line by drawing a line through the number.
      18 13
      19 14
      20 15
      21 16

  2. See IRM 3.11.13.24.2 "Employer-Employee" rate chart. Verify all Form CT-1 returns using the appropriate rate.

  3. If any of the taxpayer's entries on the lines are not legible, place an "X" to the left of the taxpayer's entry and enter the correct figure.

  4. Large depositors will fill out Form 945-A, Annual Record of Federal Tax Liability.

  5. Edit CCC "P" on a current year period return when the return has the unique identifier of "(77)" in the top left margin next to the literal "Internal Revenue Service" . See Figure 3.11.13-93

    Figure 3.11.13-93

    This image is too large to be displayed in the current screen. Please click the link to view the image.

    Form CT-1 Requiring editing of CCC P

3.11.13.24.2  (01-01-2008)
Form CT-1 Lines

  1. Lines 1 (Tier l - Employer Tax) through 10 (Tier l- Employee Medicare Tax–Sick Pay): There must be entries on lines 1 through 6.

    IF THEN
    There are entries in the tax area, but no entries in the Compensation area, Divide the tax shown by the appropriate factors in the "Employee–Employer" chart below. Enter the compensation figures for each line.
    Form CT-1 is received with a Form 8275-R (Regulation Disclosure Statement) attached, Step 1 - Photocopy the CT-1 and Form 8275-R.
    Step 2 - Route the photocopies to Compliance (Examination). They will forward it to the appropriate Territory Office.
    Step 3 - Continue to process the original return.

    EMPLOYER–EMPLOYEE TAX RATE

    Return Tax Year   Rate Rate Factor
    2001 Employer Tax
    Tier I - Compensation 6.2 16.1290
    Tier I - Medicare
    (on Wages)     		1.45 68.9655
    Tier II– - Compensation 16.1 6.2112
    Tier I - Sick Pay 6.2 16.1290
    Tier I - Medicare ( on Sick Pay) 1.45 68.9655
    Employee Tax
    Tier I - Compensation 6.2 16.1290
    Tier I - Medicare (on Wages) 1.45 68.9655
    Tier II - Compensation
    (for Tips)     		4.9 20.4082
    Tier I - Sick Pay 6.2 16.1290
    Tier I - Medicare
    (on Sick Pay)     		1.45 68.9655
    2002 Employer Tax
    Tier I - Compensation 6.2 16.1290
    Tier I - Medicare
    (on Wages)     		1.45 68.9655
    Tier II - Compensation 15.6 6.4103
    Tier I - Sick Pay 6.2 16.1290
    Tier I - Medicare ( on Sick Pay) 1.45 68.9655
    Employee Tax
    Tier I - Compensation 6.2 16.1290
    Tier - –Medicare (on Wages) 1.45 68.9655
    Tier II - Compensation
    (for Tips)     		4.9 20.4082
    Tier I - Sick Pay 6.2 16.1290
    Tier I - Medicare
    (on Sick Pay)     		1.45 68.9655
    2003 Employer Tax
    Tier I - Compensation 6.2 16.1290
    Tier I - Medicare
    (on Wages)