Federal employment taxes, equity compensation | KPMG | GLOBAL

Late deposits of federal employment taxes for equity compensation transactions

Federal employment taxes, equity compensation

Equity compensation is often paid or vests at a time other than the regular payroll date. IRS payroll deposit rules may require tax deposit dates for these “off-cycle” payments that are earlier than regularly scheduled payroll deposit dates. As a result, companies may miss the deadlines.


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Given the complexity of the deposit timing rules, employers could potentially face penalties if deadlines are missed. Thus, it would be prudent to avoid certain pitfalls. 


Read a July 2016 report [PDF 88 KB] prepared by KPMG LLP: What’s News in Tax: Late Deposits of Federal Employment Taxes for Equity Compensation Transactions—Pitfalls to Avoid

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