What is form 945?

Form 945, also known as the Annual Return of Withheld Federal Income Tax, is a form that is used by employers to report the amounts of federal income tax withheld from nonpayroll payments. These payments could include pensions, gambling winnings, backup withholding, and more.

Employers must file Form 945 annually to report these tax withholdings to the IRS. The form is due on January 31 of the following year for most businesses and organizations. If an employer fails to file Form 945 by the due date, they may be subject to penalties.

Form 945 is used to reconcile the total amount of federal income tax withheld with the total tax liabilities reported on other forms, such as Forms 941 or 944. It is important for employers to accurately report and remit all federal income tax withholdings to the IRS to avoid any penalties or issues.

Overall, Form 945 is an important tax form for employers to report and reconcile the federal income tax withholdings from nonpayroll payments throughout the year. It helps to ensure compliance with tax laws and regulations.