An employer may enter into an agreement with a Reporting Agent under which the employer authorizes the Reporting Agent to perform any or all of the acts that a PSP can perform. Transmittal of Wage and Tax Statements, and file and furnish Forms W-2, Wage and Tax Statement, for the employees of the employer using the employer's EIN.Ī Reporting Agent is a type of PSP. Make federal tax deposits (FTDs) and federal tax payments for the taxes reported on the Forms 940 and 941.File Forms 940 and 941 for the employer, which are signed by the employer.

Prepare Forms 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return, and 941, Employer’s QUARTERLY Federal Tax Return, for the employer using the employer’s EIN.

Prepare the paychecks for the employees of the employer.

An employer may enter into an agreement with a PSP under which the employer authorizes the PSP to perform one or more of the following acts on the employer’s behalf: However, employers generally remain responsible for the payment of income tax withheld and both the employer and employee portions of Social Security and Medicare taxes.Ī payroll service provider (PSP) is a third party that can help an employer administer payroll and employment tax obligations. Many employers outsource some or all of their payroll and related tax duties to third party payers.

Revenue Procedure 2012-32 - This revenue procedure provides the requirements for completing and submitting Form 8655, Reporting Agent AuthorizationĮmployers are responsible for withholding and paying over employment taxes and filing required returns.IRM 5.1.24 - Field Collecting Procedures - Third-Party Payer Arrangements for Employment Taxes.Resources (Court Cases, Chief Counsel Advice, Revenue Rulings, Internal Resources) There are no specific IRC Sections or Treas. An introduction to Payroll Service Providers and Reporting Agents and the employment tax roles of each type.

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