Treasury, IRS permit use of estimated tax overpayments to satisfy employment tax deposits

CPA Letter, The, January, 2002 by Anonymous

tax

As part of a series of action to assist taxpayers in the wake of the events of Sept. 11, the Treasury Department and the Internal Revenue Service announced procedures that business taxpayers may use to redesignate their estimated income tax overpayments as employment tax deposits, so that any overpayments can be used to pay their current employment tax obligations. The action is intended to help businesses improve cash flow.

The announcement addresses situations in which taxpayers have already paid estimated tax payments that equal or exceed their income tax liability for the year. This could occur due to unanticipated loses as a result of the Sept. 11 attacks. Businesses whose projected income was reduced as a result of the terrorist attacks will be allowed to...