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IRS Modifies Rules for Electronic Depositing of Payroll Taxes

What churches should know about the new requirements.

Congress enacted legislation a number of years ago requiring the IRS to develop a system for the electronic filing of payroll taxes. Congress wanted a simple, "paperless" way for employers to deposit their payroll taxes. In response, the IRS came up with the Electronic Federal Tax Payment System (or EFTPS). Traditionally, employers have used a paper coupon and a check to make federal tax deposits (FTDs). EFTPS eliminates most of the paperwork in the old FTD coupon system. With EFTPS, deposits may be made by telephone or personal computer, or through the financial institution of the employer.

The new electronic system is being phased in over a period of years by increasing the percentage of total taxes subject to the new EFTPS system each year. Congress mandated that 94 percent of employment taxes be collected electronically in 1999. The IRS previously assumed that this meant that ...

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  • June 1, 1999

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