What is a $100,000 next-day deposit obligation?
272 views | Last modified 9/24/2020 5:24:24 PM EST | Added by ExpressEfile Team

Applicable To
Form 941 Form 1099 / W-2 Form 2290

When accumulating taxes of $100,000 on any day of the quarter, it is mandatory to deposit those taxes by the next business day regardless of your deposit schedule. If you have accumulated a tax liability of $100,000 at least once in the quarter, they become a semi-weekly schedule depositor for the rest of the calendar year.

Employers should not accumulate their tax liabilities once the deposit is ended. For better understanding, here is an example. Let’s consider a semi-weekly schedule depositor whose payday falls between Wednesday and Friday. They have accumulated $98,000 on Friday and accumulated $20,000 on Saturday. In this scenario, the $100,000 next-day deposit rule does not apply since they have accumulated the $20,000 in the next deposit period. Thus, they can deposit their taxes as per their schedule.

Likewise, take an example of a monthly schedule depositor who accumulates $100,500 on September 5. As per their schedule, they are required to deposit taxes by October 15. But here they have to deposit it by September 6 as they have accumulated $100,000 and $100,000 next-day deposit rule applies to them. Eventually, they become a semi-weekly schedule depositor for the remaining calendar year.  
 

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