The IRS sent a letter saying I didn't file Form 945 tax return, does TurboTax not handle this?

[aknightstale]

I used TurboTax Business for my S-corp LLC I opened in 2022. The IRS has sent a letter saying I did not file a Form 945 tax return for 2022 with my company. I also pay for the TaxAudit Defense and submitted a ticket with them, however, TaxAudit said this is not their responsible or an actual audit so I would need to contact TurboTax for assistance.

I am confused. Where do I complete a Form 945 for a single member S-corp LLC in TurboTax Business windows software and e-File it? I have googled and can not find much on this subject.

I have used the IRS EFTPS website to make deposits everytime I did payroll. I did find some information:

"Any business that withholds or is required to withhold federal income tax from payments made other than their payroll must file Form 945. Businesses must only submit Form 945 if they have a non-payroll tax liability during the tax year. Note: If no non-payroll payments were made during the tax year, then you are not required to file Form 945."

At the end of the year I did a distribution outside of payroll, am I required to file annual Form 945 and where/how?

Thanks in advance!

[Mike9241]

as you noted Form 945 is to report withholding on payments reported on nonpayroll forms such as Form 1099.

https://www.irs.gov/forms-pubs/about-form-945 

sorry. but even if you do have a filing requirement, it seems Turbotax's Quick Employer Forms does not include this.

https://quickemployerforms.intuit.com/faq.htm 

an S-Corp distribution would normally only be reported on your K-1 not a 1099. The exception to this would be an S-Corp that was a C-corp making a C-corp dividend payment, but then 945 would only be required if you withheld taxes on dividend payment. 

review your filings with the iRS. perhaps you incorrectly reported withholding on the wrong line of a form.

if you did, that form may require amending. if no such error, I would suggest filing the form and checking box A. 

[aknightstale]

@Mike9241thank you for the friendly and quick reply! One last question before I call the IRS on Monday:

Looking at my 2022 returns, it looks like I issued myself a W2 and on box #14 it had Other "Health Insurance Premiums" and I had filled in that. This is the only thing I could think of... would this of triggered the IRS and make it necessary I file a Form 945? Or still not needed?

I do see the other S-corp dist was reported on a K-1. I also do not have a C-corp, only Single member LLC S-corp. I did not hold taxes on the dist payment and of course paid them accordingly myself through TurboTax Home & Business.

[Mike9241]

box 14 on the w-2 would have nothing to do with form 945

[Opus 17]

Your W-2 withholding would be reported on form 941 (quarterly) or form 944 (annual), depending on what the IRS assigned when you obtained your EIN.  I can't guess why they would think you should have submitted a form 945 if you did not have that type of withholding.  You may need to call the IRS and ask for clarification.