Form 945 for 2020

Participant received a distribution in December, client has until the 15th day of the following month to pay the withholding.

Accountant paid the withholding electronically on January 8, 2021.

For which year would 945 be due?  I'm attempting to think ahead of a possible problem with IRS.

The form is to report taxes withheld during the year regardless of when they are due to be deposited.

2 hours ago, thepensionmaven said:

Accountant paid the withholding electronically on January 8, 2021.

For which year would 945 be due?  I'm attempting to think ahead of a possible problem with IRS.

As long as accountant deposited it as a 2020 tax liability, you wont have any problems.  If accountant deposited it as 2021 tax liability, you will get IRS love letters.

That is exactly why the question.

Participant paid out 3rd week of December, withholding not due until January 15th, accountant paid on January 8, 2021.

From what you are saying, since the withholding was not actually paid (but was deducted from the participants distribution) in 2020, I would show as not paid and still owed, line 4 would be $0, line 5 would be the amount paid in January, 2021.

And mark our records to prepare a 945 for 2021, one year from now.

Oh boy, I'd better warn the client he will get a slew of love letters.

15 minutes ago, thepensionmaven said:

That is exactly why the question.

Participant paid out 3rd week of December, withholding not due until January 15th, accountant paid on January 8, 2021.

From what you are saying, since the withholding was not actually paid (but was deducted from the participants distribution) in 2020, I would show as not paid and still owed, line 4 would be $0, line 5 would be the amount paid in January, 2021.

And mark our records to prepare a 945 for 2021, one year from now.

Oh boy, I'd better warn the client he will get a slew of love letters.

Line 4 says total deposits for 2020. It doesn't say total deposits in 2020. It would show what you deposited. Why would you do a 945 in 2021?

Continuing with what Bill Presson pointed out, perhaps a more clear way to think about it, and what you are required to report on the Form 945, is when the tax liability was created.  Although the payment of the tax may not be due until the 15th of the month following the month of the distribution, the tax liability was created in the month of the distribution.  It can be confusing when you are crossing over into a different year (e.g. December distribution, January tax payment), but in your situation it seems clear to me that you would prepare a Form 945 for the 2020 year, because that is the year the tax liability was created.  Hopefully when the accountant paid the taxes on January 8th, 2021, he/she/they indicated it was for the 2020 tax year and not the 2021 tax year.  Best of luck to you.